Posted: February 1st, 2023
The U.S. Security Exchange Commission is the largest independent agency of the federal government, which helps in the smooth running of the security market and helps to protect the investors. This agency was created by Congress in 1934. At that time, this is the first federal government agency in the security market. The main objective of the SEC is to impose law against market manipulation.
The Security and Exchange Commission has the power to take legal action against the lawbreaker, and this agency also works with the Justice Department of criminal cases. Another main object of the SEC is keeping an eye on the individuals and organizations in the security market, including brokerage firms, investors and investment advisors, etc. SEC provides access to the investor along with periodic financial reports, security registration statements, and security forms by the EDGAR ( Electronic Data Gathering Analysis and Retrieval System).
Division of corporate finance – Main purpose of this division is to ensure the information provided by the investor is material and necessary for the company’s financial prospect and helps to make an informed investment decision.
Division of enforcement – This division is in charge of the SEC’s legal regulations to investigate the cases and administrating proceedings.
Division of investment management – This division helps regulate the insurance products, investment advisors and regulate the various investment companies in the security market.
Division of risk & economic analysis – This division also helps in keep the market fair and efficient and also helps to protect the investors. It also helps economic analysts and data analysts to interact with all the divisions.
Division of Trading and market – Main purpose of this division is to keep an eye on the day-to-day operations of the security market individual, organizations, security firms, and credit agencies, etc.
Functions of Security and Exchange Commission
The SEC is established during the situation of the Great Depression in 1934. So to cope up with the situation SEC is designed by the security exchange act. The main purpose of the SEC is to protect the investor in the security market and try to provide all relevant and accurate information to the investors. Some functions of SEC-
Suppose any investor enters the security market the very first time, then it is necessary to protect the investor continually. At the time of depression, many persons try to seek the way how to increase their wealth and savings for the future. SEC tries to improve economic growth and keep an eye on security transactions while promoting capital investments.
SEC helps to provide the daily overview of the activities of the security market. SEC also helps create the rules and policies by keeping an eye on interpreting matters that affect the security market’s operations.
SEC helps to provide accurate information to the investors related to the securities and full disclosures to the investors. SEC thinks about investors before themselves.
SEC has the power to take legal action against the lawbreaker in the security market and obtain all the related evidence.
Posted: February 1st, 2023
The Securities and Exchange Commission (SEC) was created in 1934 by Congress as the federal regulator of the financial markets. This was a reactionary act by Congress after the stock market crash of 1929 when the people began to distrust the securities market. Their duty, in short, is to end up enforcing fair and orderly markets. For example, certain restrictions on insider trading prevent big market players or people with big connections from taking advantage of retail investors who do not have access to such information. The SEC strives to eliminate financial crime and fraud in the securities industry and takes legal action against those who commit such crimes by collaborating with the justice department. The SEC has expertise in different markets, including digital assets such as Bitcoin, Ethereum, and other cryptocurrencies. It essentially has three duties to fulfill, protecting investors, maintaining fairness and safety of securities markets, enabling capital formation. It aims to achieve full public disclosure and also monitors corporate takeovers in the country.
The SECâ€™s focal role is to monitor and control all the stakeholders in the securities markets and ensure everything is happening fairly and honestly. It looks at securities exchanges, brokerage firms, investment advisors, investment funds, etc., and other securities market players. According to the SEC, all investors should access certain basic information about their investment before spending their valuable money on it. This is why they require companies in the securities markets to disclose relevant financial information to the public. People who have access to additional information or more useful information that is not made public are not allowed to participate in that particular companyâ€™s trading. If they do, it is considered illegal insider trading, and the SEC can take legal action against them.
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