The Securities and Exchange Commission (SEC) is an independent federal government agency responsible for protecting investors, maintaining fair and orderly functioning of the securities markets, and facilitating capital formation. It is also responsible for enforcing federal securities laws, proposing securities rules, and regulating the securities industry, the nation's stock and options exchanges, and other activities and organizations.
The Securities and Exchange Commission (SEC) is an independent federal agency that is responsible for protecting investors, maintaining fair and orderly functioning of the securities markets, and facilitating capital formation. The SEC was created in 1934 as part of the New Deal legislation in response to the stock market crash of 1929. The SEC is responsible for enforcing the federal securities laws, which are designed to promote full disclosure and protect investors against fraud.
The SEC has five primary functions:
1. Registration: The SEC requires companies to register their securities with the agency before they can be sold to the public. This registration process requires companies to provide detailed information about their business operations, financial condition, and management.
2. Disclosure: The SEC requires companies to provide investors with accurate and timely information about their business operations, financial condition, and management. This information is provided in the form of periodic reports, such as annual and quarterly reports.
3. Enforcement: The SEC has the authority to investigate potential violations of the federal securities laws and to bring civil and criminal actions against those who violate the law.
4. Market Regulation: The SEC oversees the activities of the securities markets, including the exchanges, brokers, and dealers. The SEC also regulates the activities of investment advisers, mutual funds, and other investment companies.
5. Investor Education: The SEC provides investors with information about the securities markets and investing. The SEC also provides investors with resources to help them make informed investment decisions.
The SEC is an important part of the financial system and plays a critical role in protecting investors and maintaining the integrity of the securities markets. The SEC is funded by fees paid by companies that register their securities with the agency.