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FINRA is the Financial Industry Regulatory Authority. We’re an independent, not-for-profit organization with a public mission: to protect America’s investors by making sure the securities industry operates fairly and honestly. We do that by writing and enforcing rules governing the activities of nearly 4,900 securities firms with approximately 660,000 brokers. By examining firms for compliance with those rules. By fostering market transparency. And by educating investors.
For 70 years, our independent regulation has played a critical role in America’s financial system—by enforcing high ethical standards, bringing the necessary resources and expertise to regulation and enhancing investor safeguards and market integrity—all at no cost to taxpayers.
FINRA continues that tradition today with a commitment to protect investors through strong enforcement and effective investor education. Because in an often unpredictable marketplace, investors need to know someone is looking out for them.
Every U.S. investor, every day.
Newlyweds planning to buy a home. Parents saving for a child’s college education. Seniors depending on a secure retirement.
Every one of the 90 million American investors FINRA serves has unique needs, but all rely on one thing: fair financial markets. Working with the federal government, we are every investor’s advocate—for stronger protections and a healthier marketplace.
Empowered by the federal government, we’re here to protect American investors from fraud and bad practices.
Safeguard the investing public against fraud and bad practices. By qualifying and licensing brokers, writing and enforcing rules and regulations for every single brokerage firm and broker in the United States, and investigating and disciplining anyone who violates the public trust.
Put firms under a microscope. Every day, hundreds of professionally trained FINRA financial examiners are in the field taking a close look at the way brokers operate, with a focus on the greatest risks to the markets and investors. We conduct routine examinations, as well as inquiries based on investor complaints and suspicious activity. We consult with other regulators, determine examination priorities and conduct special “sweeps” to target issues of immediate concern.
Enforce industry rules and federal securities laws. We foster investor confidence through vigorous enforcement. We can bring disciplinary actions against firms or individuals, meaning we can fine them, suspend them—even expel them—from the business. And we frequently require firms to provide restitution to investors who have been harmed.
Register, test and educate brokers. We require all brokers to register with FINRA, pass our qualification exams and satisfy continuing education requirements. As a result, FINRA maintains the largest and most sophisticated online registration and reporting system in the world—known as the Central Registration Depository. In addition, our BrokerCheck® system allows investors to check out the backgrounds of firms and brokers online:
www.finra.org/brokercheck.
Every firm and broker that sells securities in the U.S. must be licensed and registered by FINRA:
4,900 securities firms
172,000 branch offices
660,000 registered securities representatives
Work to ensure investors are not misled. We require that all broker advertisements, Web sites, sales brochures and other communications present information in a fair and balanced manner. And certain communications—those related to mutual funds, variable products and options—must be filed directly with FINRA. In 2008 alone, FINRA reviewed more than 90,000 individual advertisements and communications from firms to investors.
Keep an eye on the markets. We monitor what’s happening in the U.S. stock market —by looking for suspicious trading activity in all stocks, bonds and options traded on the NASDAQ Stock Market, the International Securities Exchange and the over-the-counter markets.
Educate and inform investors. We believe an essential component to investor protection is investor education. We offer a range of free educational resources to help investors build their financial knowledge to better understand the markets and basic principles of saving and investing. The FINRA Investor Education Foundation is the largest of its kind in the U.S.:
www.finrafoundation.org.
Demand fairness. Today’s investors have a lot at stake. And because of that, they expect to be treated fairly. When problems between brokers and investors occur, we administer the largest forum specifically designed to resolve securities-related disputes between and among investors, securities firms and individual brokers. We have 73 hearing locations around the country—including at least one in each state—and in London and Puerto Rico.
Financial Industry Regulatory Authority
Every investor deserves fundamental protections when investing in the stock market.
Every day FINRA works
Whether Americans are investing in a 401(k) or other thrift, savings or employee benefit
to ensure investors
plan, or in a mutual fund, ETF or variable annuity, FINRA works every day to ensure that:
receive the basic
protections they deserve—regardless of
anyone who sells a securities product has been officially tested, qualified and licensed1
what kind of financial
product they buy or who sells it to them.
every securities product advertisement used is truthful, and not misleading 2
any securities product promoted or sold to an investor is suitable for that investor’s needs 3
investors receive complete disclosure about the investment product before purchase 4
More than 90 million Americans are invested in the U.S. capital markets. FINRA is every investor’s advocate—for stronger protections and a healthier marketplace.
Greater transparency strengthens financial markets and empowers investors. We offer an accurate source of free information on all U.S. corporate, municipal, U.S. Treasury and Government Agency bonds—including price and yield and other useful information and news all in one place: www.finra.org/marketdata.
Today’s markets are growing more complex. To plan their financial futures, investors need to know that the system is working effectively and efficiently. And in an often unpredictable marketplace, investors need to know FINRA is looking out for them.
Alert investors are better investors. FINRA teaches investors how to avoid becoming victims—making them aware of the latest investment scams and teaching them how to identify common techniques used by unlicensed agents selling phony products. The more information investors have, the safer they’ll be.
Investors need and want more knowledge about investing. Today, 100 million Americans are entering or nearing retirement, but many haven’t saved enough—and simply don’t know enough about saving and investing. By offering unbiased information, tools and guidance to investors, FINRA makes it easier to navigate retirement and avoid common investing pitfalls.
Financial Industry Regulatory Authority
FINRA is every investor’s advocate.
Take the case of one elderly investor that FINRA helped—a 97-year-old widow in New Jersey whose long-time broker stole $400,000 for his personal use while she was in the hospital. FINRA pursued the case. The broker was prosecuted and punished; the woman got her money back.
In another case involving a broker at a large financial firm, investors were being charged excessive commission fees on a regular basis over a four-year period. Some faced overcharges as high as $1 million. FINRA fined the firm, banned the broker from the industry and customers were reimbursed.
When an 80-year-old investor was wrongly convinced by his broker to exchange his fixed annuity for a variable annuity with heavy penalties if he withdrew any of the money within six years, FINRA took action, uncovering 23 similar cases at this one firm. The firm was fined hundreds of thousands of dollars and FINRA helped investors get their money back.
We set high ethical standards for financial firms. One of our top priorities is to ensure that firms are operating fairly and openly with investors. Firms regulated by FINRA are subjected to strict regulatory requirements, including rules for broker conduct and examinations and vigorous enforcement to ensure that those rules are followed.
Our reach and impact is wide-ranging. Our work makes a real difference in the lives of investors. FINRA covers the whole “life cycle” of saving and investing. From the moment investors begin investing to the time they retire and start drawing from their savings, they can turn to FINRA for help.
We offer innovative tools to help investors make the right choices. Want up-to-the-minute market news and information? Go to FINRA’s Market Data Center. Need to check the background of a broker? Visit FINRA’s BrokerCheck. Wonder how all those mutual fund fees impact your investment? Use FINRA’s Fund Analyzer to find out.
We help employees save for—and protect—their futures. In addition to promoting automatic 401(k) enrollment for employees, we raise awareness about financial life planning, from accumulating assets before retirement to “decumulating” them in retirement—and how to make resources last a lifetime. And we work to make sure that investors don’t get defrauded out of their life’s savings.
We alert investors about new product pitfalls. When we have a serious concern about a new investment product, we share it with investors by publishing investor alerts.
FINRA’s BrokerCheck system provides background information about firms and brokers—including disciplinary history— free of charge:
www.finra.org/brokercheck
Financial Industry Regulatory Authority
On the Web and throughout the U.S.
We’re online at www.finra.org, with a wealth of information and tools to help investors make better sense of saving and investing, manage money more wisely and steer clear of risky situations. Our Web site helps investors learn how to protect themselves, invest for the future and access unbiased information.
Easy to access and easy to use, www.finra.org alerts investors about new investment scams, explains which professional titles are real and which aren’t and offers advice on how to weather tough financial times without raiding your retirement funds. All the financial tools mentioned before—plus more—can be found here.
FINRA’s Web site places critical financial information all in one place—and always puts the interests of investors first. Whether they want to learn more about annuities and insurance, or stocks, bonds and mutual funds, investors can find unbiased information and tools they can trust.
We’re located in communities across America. With 17 offices and nearly 2,800 employees deployed throughout the country, FINRA is dedicated to ensuring that our nation’s financial markets are fair and honest.
And because we operate in the communities where firms do business and disputes actually occur, we understand emerging issues affecting investors right in their own neighborhoods. This strength serves us well and it serves investors well.
Please visit www.finra.org to learn how FINRA protects you and what you can do to protect yourself.
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