FINRA
FINRA (Financial Industry Regulatory Authority) is a self-regulatory organization that oversees broker-dealers and their registered representatives, administering qualification exams and enforcing securities rules.
Exam Tip
FINRA = self-regulatory (SRO), not government. SEC = government regulator.
What is FINRA?
The Financial Industry Regulatory Authority (FINRA) is the largest independent self-regulatory organization (SRO) for securities firms in the United States. It operates under SEC oversight.
FINRA's Role
| Function | Description |
|---|---|
| Licensing | Administers qualification exams (SIE, Series 7, etc.) |
| Registration | Maintains records via CRD system |
| Rulemaking | Creates rules for member firms |
| Enforcement | Investigates violations, imposes sanctions |
| Dispute Resolution | Arbitration and mediation services |
Key FINRA Exams
| Exam | Purpose |
|---|---|
| SIE | Securities Industry Essentials (prerequisite) |
| Series 6 | Investment company products |
| Series 7 | General securities representative |
| Series 63/65/66 | State law exams (NASAA, not FINRA) |
| Series 24 | General securities principal |
FINRA Rules
- Rule 2010 - Standards of commercial honor
- Rule 2111 - Suitability
- Rule 3110 - Supervision
- Rule 4512 - Customer account information
BrokerCheck
FINRA provides a free tool called BrokerCheck where investors can research:
- Broker and firm registration
- Licensing history
- Disciplinary actions
- Customer complaints
History
FINRA was created in 2007 through the consolidation of NASD and NYSE regulation functions.
Study This Term In
Related Terms
SEC (Securities and Exchange Commission)
GeneralThe SEC is the U.S. federal agency responsible for enforcing securities laws, regulating securities markets, and protecting investors from fraud and market manipulation.
Broker-Dealer
GeneralA broker-dealer is a financial firm that buys and sells securities for its customers (broker) and for its own account (dealer), regulated by FINRA and the SEC.