What We Do
Creation of the 申博体育网址
Organization of the 申博体育网址
Laws That Govern the Industry
The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.
As more and more first-time investors turn to the markets to help secure their futures, pay for homes, and send children to college, our investor protection mission is more compelling than ever.
As our nation's securities exchanges mature into global for-profit competitors, there is even greater need for sound market regulation.
And the common interest of all Americans in a growing economy that produces jobs, improves our standard of living, and protects the value of our savings means that all of the 申博体育网址's actions must be taken with an eye toward promoting the capital formation that is necessary to sustain economic growth.
The world of investing is fascinating and complex, and it can be very fruitful. But unlike the banking world, where deposits are guaranteed by the federal government, stocks, bonds and other securities can lose value. There are no guarantees. That's why investing is not a spectator sport. By far the best way for investors to protect the money they put into the securities markets is to do research and ask questions.
The laws and rules that govern the securities industry in the United States derive from a simple and straightforward concept: all investors, whether large institutions or private individuals, should have access to certain basic facts about an investment prior to buying it, and so long as they hold it. To achieve this, the 申博体育网址 requires public companies to disclose meaningful financial and other information to the public. This provides a common pool of knowledge for all investors to use to judge for themselves whether to buy, sell, or hold a particular security. Only through the steady flow of timely, comprehensive, and accurate information can people make sound investment decisions.
The result of this information flow is a far more active, efficient, and transparent capital market that facilitates the capital formation so important to our nation's economy. To insure that this objective is always being met, the 申博体育网址 continually works with all major market participants, including especially the investors in our securities markets, to listen to their concerns and to learn from their experience.
The 申博体育网址 oversees the key participants in the securities world, including securities exchanges, securities brokers and dealers, investment advisors, and mutual funds. Here the 申博体育网址 is concerned primarily with promoting the disclosure of important market-related information, maintaining fair dealing, and protecting against fraud.
Crucial to the 申博体育网址's effectiveness in each of these areas is its enforcement authority. Each year the 申博体育网址 brings hundreds of civil enforcement actions against individuals and companies for violation of the securities laws. Typical infractions include insider trading, accounting fraud, and providing false or misleading information about securities and the companies that issue them.
One of the major sources of information on which the 申博体育网址 relies to bring enforcement action is investors themselves — another reason that educated and careful investors are so critical to the functioning of efficient markets. To help support investor education, the 申博体育网址 offers the public a wealth of educational information on this Internet website, which also includes the EDGAR database of disclosure documents that public companies are required to file with the Commission.
Though it is the primary overseer and regulator of the U.S. securities markets, the 申博体育网址 works closely with many other institutions, including Congress, other federal departments and agencies, the self-regulatory organizations (e.g. the stock exchanges), state securities regulators, and various private sector organizations. In addition, the Chairman of the 申博体育网址 represents the agency as a member of the Financial Stability Oversight Council (FSOC).
This article is an overview of the 申博体育网址's history, responsibilities, activities, organization, and operation. More detailed information about many of these topics is available throughout this website.
The 申博体育网址's foundation was laid in an era that was ripe for reform. Before the Great Crash of 1929, there was little support for federal regulation of the securities markets. This was particularly true during the post-World War I surge of securities activity. Proposals that the federal government require financial disclosure and prevent the fraudulent sale of stock were never seriously pursued.
Tempted by promises of "rags to riches" transformations and easy credit, most investors gave little thought to the systemic risk that arose from widespread abuse of margin financing and unreliable information about the securities in which they were investing. During the 1920s, approximately 20 million large and small shareholders took advantage of post-war prosperity and set out to make their fortunes in the stock market. It is estimated that of the $50 billion in new securities offered during this period, half became worthless.
|President Franklin D. Roosevelt|
When the stock market crashed in October 1929, public confidence in the markets plummeted. Investors large and small, as well as the banks who had loaned to them, lost great sums of money in the ensuing Great Depression. There was a consensus that for the economy to recover, the public's faith in the capital markets needed to be restored. Congress held hearings to identify the problems and search for solutions.
Based on the findings in these hearings, Congress — during the peak year of the Depression — passed the Securities Act of 1933. This law, together with the Securities Exchange Act of 1934, which created the 申博体育网址, was designed to restore investor confidence in our capital markets by providing investors and the markets with more reliable information and clear rules of honest dealing. The main purposes of these laws can be reduced to two common-sense notions:
- Companies publicly offering securities for investment dollars must tell the public the truth about their businesses, the securities they are selling, and the risks involved in investing.
- People who sell and trade securities – brokers, dealers, and exchanges – must treat investors fairly and honestly, putting investors' interests first.
Monitoring the securities industry requires a highly coordinated effort. Congress established the Securities and Exchange Commission in 1934 to enforce the newly-passed securities laws, to promote stability in the markets and, most importantly, to protect investors. President Franklin Delano Roosevelt appointed Joseph P. Kennedy, President John F. Kennedy's father, to serve as the first Chairman of the 申博体育网址.
The 申博体育网址 consists of five presidentially-appointed Commissioners, with staggered five-year terms (see 申博体育网址 Organization Chart; text version also available). One of them is designated by the President as Chairman of the Commission — the agency's chief executive. By law, no more than three of the Commissioners may belong to the same political party, ensuring non-partisanship. The agency's functional responsibilities are organized into five Divisions and 24 申博官网s, each of which is headquartered in Washington, DC. The Commission's approximately 4,600 staff are located in Washington and in 11 Regional 申博官网s throughout the country.
It is the responsibility of the Commission to:
- interpret and enforce federal securities laws;
- issue new rules and amend existing rules;
- oversee the inspection of securities firms, brokers, investment advisers, and ratings agencies;
- oversee private regulatory organizations in the securities, accounting, and auditing fields; and
- coordinate U.S. securities regulation with federal, state, and foreign authorities.
The Commission convenes regularly at meetings that are open to the public and the news media unless the discussion pertains to confidential subjects, such as whether to bring an enforcement action.
The Division of Corporation Finance assists the Commission in executing its responsibility to oversee corporate disclosure of important information to the investing public. Corporations are required to comply with regulations pertaining to disclosure that must be made when stock is initially sold and then on a continuing and periodic basis. The Division's staff routinely reviews the disclosure documents filed by companies. The staff also provides companies with assistance interpreting the Commission's rules and recommends to the Commission new rules for adoption.
The Division of Corporation Finance reviews documents that publicly-held companies are required to file with the Commission. The documents include:
- registration statements for newly-offered securities;
- annual and quarterly filings (Forms 10-K and 10-Q);
- proxy materials sent to shareholders before an annual meeting;
- annual reports to shareholders;
- documents concerning tender offers (a tender offer is an offer to buy a large number of shares of a corporation, usually at a premium above the current market price); and
- filings related to mergers and acquisitions.
These documents disclose information about the companies' financial condition and business practices to help investors make informed investment decisions. Through the Division's review process, the staff monitors compliance with disclosure requirements and seeks to improve the quality of the disclosure. To meet the 申博体育网址's requirements for disclosure, a company issuing securities or whose securities are publicly traded must make available all information, whether it is positive or negative, that might be relevant to an investor's decision to buy, sell, or hold the security.
Corporation Finance provides administrative interpretations of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Trust Indenture Act of 1939, and recommends regulations to implement these statutes. Working closely with the 申博官网 of the Chief Accountant, the Division monitors the activities of the accounting profession, particularly the Financial Accounting Standards Board (FASB), that result in the formulation of generally accepted accounting principles (GAAP). Increasingly, the Division also monitors the use by U.S. registrants of International Financial Reporting Standards (IFRS), promulgated by the International Accounting Standards Board.
The Division's staff provides guidance and counseling to registrants, prospective registrants, and the public to help them comply with the law. For example, a company might ask whether the offering of a particular security requires registration with the 申博体育网址. Corporation Finance would share its interpretation of the relevant securities regulations with the company and give it advice on compliance with the appropriate disclosure requirement.
The Division uses no-action letters to issue guidance in a more formal manner. A company seeks a no-action letter from the staff of the 申博体育网址 when it plans to enter uncharted legal territory in the securities industry. For example, if a company wants to try a new marketing or financial technique, it can ask the staff to write a letter indicating whether it would or would not recommend that the Commission take action against the company for engaging in its new practice.
How the 申博体育网址 Rulemaking Process Works
Rulemaking is the process by which federal agencies implement legislation passed by Congress and signed into law by the President. Major pieces of legislation, such as the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Company and Investment Adviser Acts of 1940 provide the framework for the 申博体育网址's oversight of the securities markets. These statutes generally are broadly drafted, establishing basic principles and objectives. To ensure that the intent of Congress is carried out in specific circumstances — and as the securities markets evolve technologically, expand in size, and offer new products and services — the 申博体育网址 engages in rulemaking.
Rulemaking can involve several steps: concept release, rule proposal, and rule adoption.
Concept Release: The rulemaking process usually begins with a rule proposal, but sometimes an issue is so unique and/or complicated that the Commission seeks out public input on which, if any, regulatory approach is appropriate. A concept release is issued describing the area of interest and the Commission's concerns and usually identifying different approaches to addressing the problem, followed by a series of questions that seek the views of the public on the issue. The public's feedback is taken into consideration as the Commission decides which approach, if any, is appropriate.
Rule Proposal: The Commission publishes a detailed formal rule proposal for public comment. Unlike a concept release, a rule proposal advances specific objectives and methods for achieving them. Typically the Commission provides between 30 and 90 days for review and comment. Just as with a concept release, the public comment is considered vital to the formulation of a final rule.
Rule Adoption: Finally, the Commissioners consider what they have learned from the public exposure of the proposed rule, and seek to agree on the specifics of a final rule. If a final measure is then adopted by the Commission, it becomes part of the official rules that govern the securities industry.
The Division of Trading and Markets assists the Commission in executing its responsibility for maintaining fair, orderly, and efficient markets. The staff of the Division provide day-to-day oversight of the major securities market participants: the securities exchanges; securities firms; self-regulatory organizations (SROs) including the Financial Industry Regulatory Authority (FInRA), the Municipal Securities Rulemaking Board (MSRB), clearing agencies that help facilitate trade settlement; transfer agents (parties that maintain records of securities owners); securities information processors; and credit rating agencies.
The Division also oversees the Securities Investor Protection Corporation (SIPC), which is a private, non-profit corporation that insures the securities and cash in the customer accounts of member brokerage firms against the failure of those firms. It is important to remember that SIPC insurance does not cover investor losses arising from market declines or fraud.
The Division's additional responsibilities include:
- carrying out the Commission's financial integrity program for broker-dealers;
- reviewing (and in some cases approving, under authority delegated from the Commission) proposed new rules and proposed changes to existing rules filed by the SROs;
- assisting the Commission in establishing rules and issuing interpretations on matters affecting the operation of the securities markets; and
- surveilling the markets.
Division of Investment Management
The Division of Investment Management assists the Commission in executing its responsibility for investor protection and for promoting capital formation through oversight and regulation of America's $66.8 trillion investment management industry. This important part of the U.S. capital markets includes mutual funds and the professional fund managers who advise them; analysts who research individual assets and asset classes; and investment advisers to individual customers. Because of the high concentration of individual investors in the mutual funds, exchange-traded funds, and other investments that fall within the Division's purview, the Division of Investment Management is focused on ensuring that disclosures about these investments are useful to retail customers, and that the regulatory costs which consumers must bear are not excessive.
The Division's additional responsibilities include:
- assisting the Commission in interpreting laws and regulations for the public and 申博体育网址 inspection and enforcement staff;
- responding to no-action requests and requests for exemptive relief;
- reviewing investment company and investment adviser filings;
- assisting the Commission in enforcement matters involving investment companies and advisers; and
- advising the Commission on adapting 申博体育网址 rules to new circumstances.
Division of Enforcement
The Division of Enforcement assists the Commission in executing its law enforcement function by recommending the commencement of investigations of securities law violations, by recommending that the Commission bring civil actions in federal court or as administrative proceedings before an administrative law judge, and by prosecuting these cases on behalf of the Commission. As an adjunct to the 申博体育网址's civil enforcement authority, the Division works closely with law enforcement agencies in the U.S. and around the world to bring criminal cases when appropriate.
The Division obtains evidence of possible violations of the securities laws from many sources, including market surveillance activities, investor tips and complaints, other Divisions and 申博官网s of the 申博体育网址, the self-regulatory organizations and other securities industry sources, and media reports.
All 申博体育网址 investigations are conducted privately. Facts are developed to the fullest extent possible through informal inquiry, interviewing witnesses, examining brokerage records, reviewing trading data, and other methods. With a formal order of investigation, the Division's staff may compel witnesses by subpoena to testify and produce books, records, and other relevant documents. Following an investigation, 申博体育网址 staff present their findings to the Commission for its review. The Commission can authorize the staff to file a case in federal court or bring an administrative action. In many cases, the Commission and the party charged decide to settle a matter without trial.
Common conduct that may lead to 申博体育网址 investigations include:
Whether the Commission decides to bring a case in federal court or within the 申博体育网址 before an administrative law judge may depend upon the type of sanction or relief that is being sought. For example, the Commission may bar someone from the brokerage industry in an administrative proceeding, but an order barring someone from acting as a corporate officer or director must be obtained in federal court. Often, when the misconduct warrants it, the Commission will bring both proceedings.
- Civil action: The Commission files a complaint with a U.S. District Court and asks the court for a sanction or remedy. Often the Commission asks for a court order, called an injunction, that prohibits any further acts or practices that violate the law or Commission rules. An injunction can also require audits, accounting for frauds, or special supervisory arrangements. In addition, the 申博体育网址 can seek civil monetary penalties, or the return of illegal profits (called disgorgement). The court may also bar or suspend an individual from serving as a corporate officer or director. A person who violates the court's order may be found in contempt and be subject to additional fines or imprisonment.
- Administrative action: The Commission can seek a variety of sanctions through the administrative proceeding process. Administrative proceedings differ from civil court actions in that they are heard by an administrative law judge (ALJ), who is independent of the Commission. The administrative law judge presides over a hearing and considers the evidence presented by the Division staff, as well as any evidence submitted by the subject of the proceeding. Following the hearing the ALJ issues an initial decision that includes findings of fact and legal conclusions. The initial decision also contains a recommended sanction. Both the Division staff and the defendant may appeal all or any portion of the initial decision to the Commission. The Commission may affirm the decision of the ALJ, reverse the decision, or remand it for additional hearings. Administrative sanctions include cease and desist orders, suspension or revocation of broker-dealer and investment advisor registrations, censures, bars from association with the securities industry, civil monetary penalties, and disgorgement.
Division of Economic and Risk Analysis
The Division of Economic and Risk Analysis assists the Commission in executing its mission to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation by integrating robust economic analysis and rigorous data analytics into the work of the 申博体育网址. The Division has a broad role in Commission activities, interacting with nearly every Division and 申博官网, providing sophisticated and data-driven economic and risk analyses to help inform the agency's policymaking, rulemaking, enforcement, and examinations.
There are two main functions for the Division. First, DERA staff provide vital support in the form of economic analyses in support of Commission rulemaking and policy development. Second, the Division also provides economic analysis and research, risk assessment, and data analytics to critically support the agency's resources on matters presenting the greatest perceived risks in litigation, examinations, and registrant reviews, as well as providing economic support for enforcement matters.
Among the functions performed by the Division are:
- Analyzing the potential economic effects of Commission rulemakings or other Commission actions. In this role, offices within DERA works closely with the other Divisions and 申博官网s to help examine the need for regulatory action, analyze the potential economic effects of rules and other Commission actions, develop data-driven analyses of market activity, and assist in evaluating public comments and studies.
- Providing quantitative and qualitative research and support related to risk assessment. DERA staff help the Commission to anticipate, identify, and manage risks, focusing on early identification of potential fraud and illegal or questionable activities. Staff collects, analyzes, and disseminates information to the Commission and its Staff about regulated entities and market activity.
- Assisting the Division of Enforcement by, for example, providing economic and quantitative analysis and support in enforcement proceedings and settlement negotiations.
申博官网 of the General Counsel
The General Counsel is appointed by the Chairman as the chief legal officer of the Commission, with overall responsibility for the establishment of agency policy on legal matters. The General Counsel serves as the chief legal advisor to the Chairman regarding all legal matters and services performed within, or involving, the agency, and provides legal advice to the Commissioners, the Divisions, the 申博官网s, and other 申博体育网址 components as appropriate.
The General Counsel represents the 申博体育网址 in civil, private, or appellate proceedings as appropriate, including appeals from the decisions of the federal district courts or the Commission in enforcement matters, and appeals from the denial of requests under the Freedom of Information Act. Through its amicus curiae program, the General Counsel often intervenes in private appellate litigation involving novel or important interpretations of the securities laws, and the 申博官网 is responsible for coordinating with the Department of Justice in the preparation of briefs on behalf of the United States involving matters in which the 申博体育网址 has an interest.
The General Counsel is also responsible for determining the adherence by attorneys in the 申博体育网址 to appropriate professional standards, as well as for providing advice on standards of conduct to Commissioners and staff, as appropriate. It is responsible for the final drafting of all proposed legislation that the Chairman or the Commission choose to submit for consideration to the Congress or the states, and for coordinating the 申博体育网址 staff positions on such legislation.
申博官网 of the Chief Accountant
The Chief Accountant is appointed by the Chairman to be the principal adviser to the Commission on accounting and auditing matters. The 申博官网 of the Chief Accountant assists the Commission in executing its responsibility under the securities laws to establish accounting principles, and for overseeing the private sector standards-setting process. The 申博官网 works closely with the Financial Accounting Standards Board, whose accounting standards the Commission has recognized as generally accepted for purposes of the federal securities laws, as well as the International Accounting Standards Board and the American Institute of Certified Public Accountants.
In addition to its responsibility for accounting standards, the Commission is responsible for the approval or disapproval of auditing rules put forward by the Public Company Accounting Oversight Board, a private-sector regulator established by the Sarbanes-Oxley Act to oversee the auditing profession. The Commission also has thorough-going oversight responsibility for all of the activities of the PCAOB, including approval of its annual budget. To assist the Commission in the execution of these responsibilities, the 申博官网 of the Chief Accountant is the principal liaison with the PCAOB. The 申博官网 also consults with registrants and auditors on a regular basis regarding the application of accounting and auditing standards and financial disclosure requirements.
Because of its expertise and ongoing involvement with questions concerning the financial books and records of public companies registered with the 申博体育网址, the 申博官网 of the Chief Accountant is often called upon to assist in addressing issues that arise in the context of Commission enforcement actions.
申博官网 of Compliance Inspections and Examinations
The 申博官网 of Compliance Inspections and Examinations administers the 申博体育网址's nationwide examination and inspection program for registered self-regulatory organizations, broker-dealers, transfer agents, clearing agencies, investment companies, and investment advisers. The 申博官网 conducts inspections to foster compliance with the securities laws, to detect violations of the law, and to keep the Commission informed of developments in the regulated community. Among the more important goals of the examination program is the quick and informal correction of compliance problems. When the 申博官网 finds deficiencies, it issues a "deficiency letter" identifying the problems that need to be rectified and monitor the situation until compliance is achieved. Violations that appear too serious for informal correction are referred to the Division of Enforcement.
申博官网 of Credit Ratings
In July 2010, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act"), which amended Section 15E of the Securities Exchange Act of 1934 to enhance the regulation, accountability, and transparency of nationally recognized statistical rating organizations or "NRSROs."
The Dodd-Frank Act mandated the creation of the 申博官网 of Credit Ratings (“OCR”) in support of the Commission’s mission to protect investors, facilitate capital formation, and maintain fair, orderly and efficient markets. OCR was established in June 2012 with the appointment of its Director, Thomas J. Butler.
The 申博官网 is charged with administering the rules of the Commission with respect to the practices of NRSROs in determining credit ratings for the protection of users of credit ratings and in the public interest; promoting accuracy in credit ratings issued by NRSROs; and working to ensure that credit ratings are not unduly influenced by conflicts of interest and that NRSROs provide greater transparency and disclosure to investors.
In support of this mission, OCR conducts examinations of NRSROs to assess and promote compliance with statutory and Commission requirements; monitors the activities of NRSROs, conducts outreach with investors, issuers, and other industry participants; develops and administers rules affecting NRSROs; and provides guidance generally with respect to the Commission’s regulatory initiatives related to NRSROs. OCR also liaises with domestic and foreign regulators on credit rating agency initiatives to facilitate regulatory cohesion and enhance the Commission’s role in the global regulatory environment.
The 申博官网 is located in New York and Washington, D.C. and is staffed with individuals including examiners, attorneys and accountants with expertise in, among other areas, structured finance, corporate finance, municipal finance, financial institutions, insurance companies, and credit rating agencies.
申博官网 of International Affairs
The 申博体育网址 works extensively in the international arena to promote cooperation among national securities regulatory agencies, and to encourage the maintenance of high regulatory standards worldwide. The 申博官网 of International Affairs assists the Chairman and the Commission in the development and implementation of the 申博体育网址's international regulatory and enforcement initiatives. The 申博官网 negotiates bilateral and multilateral agreements for Commission approval on such subjects as regulatory cooperation and enforcement assistance, and oversees the implementation of such arrangements. It is also responsible for advancing the Commission's agenda in international meetings and organizations. The 申博官网 also conducts a technical assistance program for countries with emerging securities markets, which includes training both in the United States and in the requesting country. Over 100 countries currently participate in this program.
申博官网 of Investor Education and Advocacy
The 申博官网 of Investor Education and Advocacy has three main functional areas:
The 申博官网 of Investor Assistance responds to questions, complaints, and suggestions from the members of the public. Tens of thousands of investors contact the 申博体育网址 each year using the agency's online forms or our (800) 申博体育网址-0330 hotline (toll-free in U.S.) to ask questions on a wide range of securities-related topics, to complain about problems with their investments or their financial professionals, or to suggest improvements to the agency's regulations and procedures.
The 申博官网 of Investor Education carries out the 申博体育网址's investor education program, which includes producing and distributing educational materials, participating in educational seminars and investor-oriented events, and partnering with federal agencies, state regulators, and others on investor literacy initiatives.
The 申博官网 of the Chief Counsel creates public-facing content on securities-related topics (including for Investor.gov, the 申博体育网址's website designed for individual investors) and provides advice to OIEA on securities and administrative law issues.
申博官网 of Municipal Securities
The 申博官网 of Municipal Securities coordinates the 申博体育网址's municipal securities activities, administers 申博体育网址 rules relating to the municipal securities market, advises the Commission on policy matters relating to the municipal bond market, and provides technical assistance in the development and implementation of major 申博体育网址 initiatives in the municipal securities area.
申博官网 of Ethics Counsel
The 申博官网 of the Ethics Counsel is responsible for advising and counseling all Commission employees and members on such issues as personal and financial conflicts of interest, securities holdings and transactions of Commission employees and their immediate families, gifts, seeking and negotiating other employment, outside activities, financial disclosure, and post-employment restrictions.
申博官网 of the Investor Advocate
The 申博官网 of Investor Advocate has four core functions, to provide a voice for investors to ensure their needs are considered in 申博体育网址 decision-making, to assist retail investors, to study investor behavior and to support the 申博体育网址’s Investor Advisory Committee.
申博官网 of Women and Minority Inclusion
The 申博官网 of Minority and Women Inclusion (OMWI) is responsible for all matters related to diversity in management, employment and business activities at the 申博体育网址. OMWI is committed to ensuring that diversity and inclusion are leveraged throughout the agency to advance the 申博体育网址's mission to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.
申博官网 of the Chief Operating 申博官网r
The 申博官网 of the Chief Operating 申博官网r assists the Chairman in developing and executing the management policies of the 申博体育网址. The 申博官网 formulates budget and authorization strategies, supervises the allocation and use of 申博体育网址 resources, promotes management controls and financial integrity, manages the administrative support offices, and oversees the development and implementation of the 申博体育网址's automated information systems. The 申博官网 has six main functional areas:
The EDGAR Business 申博官网 provides direct executive-level oversight for the ongoing transformation of specific functions and programs to include business ownership of the Electronic Data Gathering, Analysis, and Retrieval System (EDGAR) and the respective EDGAR redesign program initiative
The 申博官网 of Acquisitions develops and executes programs for the 申博体育网址's acquisitions policy, procurement and contract administration, acquisitions workforce training and certification, and government purchase card.
The 申博官网 of Financial Management administers the financial management and budget functions of the 申博体育网址. The 申博官网 assists the Chairman and the Executive Director in formulating budget and authorization requests, monitors the utilization of agency resources, and develops, oversees, and maintains 申博体育网址 financial systems. These activities include cash management, accounting, fee collections, travel policy development, and oversight and budget justification and execution.
The 申博官网 of Support Operations assists the Chairman and the Executive Director in managing the agency's facilities and assets, and provides a wide range of support services to the 申博体育网址 staff. The 申博官网 serves the Headquarters 申博官网 and all Regional 申博官网 locations on matters including property management, office lease acquisition and administration, space renovation, supplies and office equipment management, transportation, mail distribution, publications, printing, and desktop publishing. Also, OSO is responsible for the processing of requests under the Freedom of Information and Privacy Acts, the management of all agency records in accordance with the Federal Records Act, and maintaining the security and safety of all 申博体育网址 facilities.
The 申博官网 of Human Resources assists the Chairman in recruiting and retaining the best and the brightest professional staff in the federal workforce, and in ensuring that the 申博体育网址 remains the employer of choice within the federal government. The 申博官网 has overall responsibility for the strategic management of the 申博体育网址's human capital. In addition, it is responsible for ensuring compliance with all federal regulations for the following areas: recruitment, staffing, retention, and separation; position management and classification; compensation and benefits counseling and processing; leadership and employee development; performance management and awards; employee relations; labor relations; the 申博体育网址's disability, work/life, and telework programs; employee records processing and maintenance; and employee financial disclosure. The 申博官网 also represents the Commission as the liaison to the U.S. 申博官网 of Personnel Management and other Federal Government agencies, various public and private-sector professional human resources organizations, and educational institutions in matters relating to human capital management.
The 申博官网 of Information Technology supports the Commission and staff of the 申博体育网址 in all aspects of information technology. The 申博官网 has overall management responsibility for the Commission's IT program including application development, infrastructure operations and engineering, user support, IT program management, capital planning, security, and enterprise architecture. The 申博官网 operates the Electronic Data Gathering Analysis and Retrieval (EDGAR) system, which electronically receives, processes, and disseminates more than 500,000 financial statements every year. The 申博官网 also maintains a very active website that contains a wealth of information about the Commission and the securities industry, and also hosts the EDGAR database for free public access.
申博官网 of Legislative and Intergovernmental Affairs
The 申博官网 of Legislative Affairs and Intergovernmental Affairs serves as the agency's formal liaison with the Congress, other Executive Branch agencies, and state and local governments. The staff carefully monitor ongoing legislative activities and initiatives on Capitol Hill that affect the Commission and its mission. Through regular communication and consultation with House and Senate members and staff, the 申博官网 communicates legislators' goals to the agency, and communicates the agency's own regulatory and management initiatives to the Congress.
The 申博官网 is responsible for responding to congressional requests for testimony of 申博体育网址 officials, as well as requests for documents, technical assistance, and other information. In addition, the 申博官网 monitors legislative and oversight hearings that pertain to the securities markets and the protection of investors, even when an 申博体育网址 witness is not present.
|Additional Information About the 申博体育网址|
申博官网 of Public Affairs
The 申博官网 of Public Affairs (OPA) assists the Commission in making the work of the 申博体育网址 open to the public, understandable to investors and accountable to taxpayers. The 申博官网 helps every other 申博体育网址 division and office accomplish the agency's mission – to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. OPA's principal activity is to communicate the agency's work and deliver the agency's data and other digital information to the public, market participants and other stakeholders on 申博体育网址.gov. In addition to managing 申博体育网址.gov and other digital media platforms, the 申博官网 administers internal and external communications programs.
申博官网 of the Secretary
The Secretary of the Commission is appointed by the Chairman, and is responsible for the procedural administration of Commission meetings, rulemaking, practice, and procedure. Among the responsibilities of the 申博官网 are the scheduling and recording of public and non-public meetings of the Commission; the administration of the process by which the Commission takes action without a meeting (called the seriatim process); the administration of the duty-officer process (by which a single Commissioner is designated to authorize emergency action); the maintenance of records of Commission actions; and the maintenance of records of financial judgments in enforcement proceedings. The 申博官网 also provides advice to the Commission and the staff on questions of practice and procedure.
The 申博官网 reviews all 申博体育网址 documents submitted by the staff to the Commission. These include rulemaking releases, 申博体育网址 enforcement orders and litigation releases, SRO rulemaking notices and orders, and actions taken by 申博体育网址 staff pursuant to delegated authority. In addition, it receives and tracks documents filed in administrative proceedings, requests for confidential treatment, and comment letters on rule proposals. The 申博官网 is responsible for publishing official documents and releases of Commission actions in the Federal Register and the 申博体育网址 Docket, and it posts them on the 申博体育网址 Internet website, www.sec.gov. The 申博官网 also monitors compliance with the Government in the Sunshine Act.
申博官网 of Equal Employment Opportunity
Because the 申博体育网址's employees are its most important resource, the 申博官网 of Equal Employment Opportunity works to ensure that the agency's professional staff come from diverse backgrounds that reflect the diversity of the investing public. Equal employment opportunity at the 申博体育网址 is a continuing commitment. To maintain neutrality in resolving disputes, the EEO 申博官网 is independent of any other 申博体育网址 office. The EEO Director reports to the Chairman. The primary mission of the EEO 申博官网 is to prevent employment discrimination, including discriminatory harassment, so that all 申博体育网址 employees have the working environment to support them in their efforts to protect investors, maintain healthy markets, and promote capital formation.
申博官网 of the Inspector General
The 申博官网 of the Inspector General conducts internal audits and investigations of 申博体育网址 programs and operations. Through these audits and investigations, the Inspector General seeks to identify and mitigate operational risks, enhance government integrity, and improve the efficiency and effectiveness of 申博体育网址 programs.
申博官网 of Administrative Law Judges
The Commission's 申博官网 of Administrative Law Judges consists of independent judicial officers who conduct hearings and rule on allegations of securities law violations in cases initiated by the Commission. When the Commission initiates a public administrative proceeding, it refers the cases to the 申博官网, where it is assigned to an individual Administrative Law Judge (ALJ). The ALJ then conducts a public hearing that is similar to a non-jury trial in the federal courts. Just as a federal judge can do, an ALJ issues subpoenas, rules on motions, and rules on the admissibility of evidence. At the conclusion of the hearing, the parties submit proposed findings of fact and conclusions of law. The ALJ prepares an initial decision that includes factual findings and legal conclusions that are matters of public record. Parties may appeal an initial decision to the Commission, which can affirm, reverse, modify, set aside or remand for further proceedings. Appeals from Commission action are to a United States Court of Appeals.
申博官网 of the Advocate for Small Business Capital Formation
The 申博官网 of the Advocate for Small Business Capital Formation (OASB) is an independent office that works to advance the interests of small businesses and their investors at the 申博体育网址 and in the capital markets. OASB advocates for small businesses and their investors by conducting outreach to solicit views on relevant capital formation issues, providing assistance to resolve significant problems, analyzing the potential small business impact of proposed regulations and rules, and recommending changes to mitigate capital formation issues and promote the interests of small businesses and their investors.
Securities Act of 1933
Often referred to as the "truth in securities" law, the Securities Act of 1933 has two basic objectives:
- require that investors receive financial and other significant information concerning securities being offered for public sale; and
- prohibit deceit, misrepresentations, and other fraud in the sale of securities.
The full text of this Act is available at: /about/laws/sa33.pdf.
Purpose of Registration
A primary means of accomplishing these goals is the disclosure of important financial information through the registration of securities. This information enables investors, not the government, to make informed judgments about whether to purchase a company's securities. While the 申博体育网址 requires that the information provided be accurate, it does not guarantee it. Investors who purchase securities and suffer losses have important recovery rights if they can prove that there was incomplete or inaccurate disclosure of important information.
The Registration Process
In general, securities sold in the U.S. must be registered. The registration forms companies file provide essential facts while minimizing the burden and expense of complying with the law. In general, registration forms call for:
- a description of the company's properties and business;
- a description of the security to be offered for sale;
- information about the management of the company; and
- financial statements certified by independent accountants.
All companies, both domestic and foreign, must file their registration statements electronically. These statements and the accompanying prospectuses become public shortly after filing, and investors can access them using EDGAR. Registration statements are subject to examination for compliance with disclosure requirements.
Not all offerings of securities must be registered with the Commission. Some exemptions from the registration requirement include:
- private offerings to a limited number of persons or institutions;
- offerings of limited size;
- intrastate offerings; and
- securities of municipal, state, and federal governments.
By exempting many small offerings from the registration process, the 申博体育网址 seeks to foster capital formation by lowering the cost of offering these types of securities to the public.
Securities Exchange Act of 1934
With this Act, Congress created the Securities and Exchange Commission. The Act empowers the 申博体育网址 with broad authority over all aspects of the securities industry. This includes the power to register, regulate, and oversee brokerage firms, transfer agents, and clearing agencies as well as the nation's securities self regulatory organizations (SROs). The various stock exchanges, such as the New York Stock Exchange, and The Nasdaq Stock Market are SROs. The Financial Industry Regulatory Authority (FINRA) is also an SRO.
The Act also identifies and prohibits certain types of conduct in the markets and provides the Commission with disciplinary powers over regulated entities and persons associated with them.
The Act also empowers the 申博体育网址 to require periodic reporting of information by companies with publicly traded securities.
Companies with more than $10 million in assets whose equity securities are held by more than a specified number of holders must file annual and other periodic reports. These reports are available to the public through the 申博体育网址's EDGAR database.
The Securities Exchange Act also governs the disclosure in materials used to solicit shareholders' votes in annual or special meetings held for the election of directors and the approval of other corporate action. This information, contained in proxy materials, must be filed with the Commission in advance of any solicitation to ensure compliance with the disclosure rules. Solicitations, whether by management or shareholder groups, must disclose all important facts concerning the issues on which holders are asked to vote.
The Securities Exchange Act requires disclosure of important information by anyone seeking to acquire more than 5 percent of a company's securities by direct purchase or tender offer. Such an offer often is extended in an effort to gain control of the company. As with the proxy rules, this allows shareholders to make informed decisions on these critical corporate events.
The securities laws broadly prohibit fraudulent activities of any kind in connection with the offer, purchase, or sale of securities. These provisions are the basis for many types of disciplinary actions, including actions against fraudulent insider trading. Insider trading is illegal when a person trades a security while in possession of material nonpublic information in violation of a duty to withhold the information or refrain from trading.
Registration of Exchanges, Associations, and Others
The Act requires a variety of market participants to register with the Commission, including exchanges, brokers and dealers, transfer agents, and clearing agencies. Registration for these organizations involves filing disclosure documents that are updated on a regular basis.
The exchanges and the Financial Industry Regulatory Authority (FINRA) are identified as self-regulatory organizations (SRO). SROs must create rules that allow for disciplining members for improper conduct and for establishing measures to ensure market integrity and investor protection. SRO proposed rules are published for comment before final 申博体育网址 review and approval.
The full text of this Act can be read at: /about/laws/sea34.pdf.
Trust Indenture Act of 1939
This Act applies to debt securities such as bonds, debentures, and notes that are offered for public sale. Even though such securities may be registered under the Securities Act, they may not be offered for sale to the public unless a formal agreement between the issuer of bonds and the bondholder, known as the trust indenture, conforms to the standards of this Act. The full text of this Act can be read at: /about/laws/tia39.pdf.
Investment Company Act of 1940
This Act regulates the organization of companies, including mutual funds, that engage primarily in investing, reinvesting, and trading in securities, and whose own securities are offered to the investing public. The regulation is designed to minimize conflicts of interest that arise in these complex operations. The Act requires these companies to disclose their financial condition and investment policies to investors when stock is initially sold and, subsequently, on a regular basis. The focus of this Act is on disclosure to the investing public of information about the fund and its investment objectives, as well as on investment company structure and operations. It is important to remember that the Act does not permit the 申博体育网址 to directly supervise the investment decisions or activities of these companies or judge the merits of their investments. The full text of this Act is available at: /about/laws/ica40.pdf.
Investment Advisers Act of 1940
This law regulates investment advisers. With certain exceptions, this Act requires that firms or sole practitioners compensated for advising others about securities investments must register with the 申博体育网址 and conform to regulations designed to protect investors. Since the Act was amended in 1996, generally only advisers who have at least $100 million of assets under management or advise a registered investment company must register with the Commission. The full text of this Act is available at: /about/laws/iaa40.pdf.
Sarbanes-Oxley Act of 2002
On July 30, 2002, President George W. Bush signed into law the Sarbanes-Oxley Act of 2002, which he characterized as "the most far reaching reforms of American business practices since the time of Franklin Delano Roosevelt." The Act mandated a number of reforms to enhance corporate responsibility, enhance financial disclosures and combat corporate and accounting fraud, and created the "Public Company Accounting Oversight Board," also known as the PCAOB, to oversee the activities of the auditing profession. The full text of the Act is available at: http://uscode.house.gov/download/pls/15C98.txt. (Please check the Classification Tables maintained by the US House of Representatives 申博官网 of the Law Revision Counsel for updates to any of the laws.) You can find links to all Commission rulemaking and reports issued under the Sarbanes-Oxley Act at: /spotlight/sarbanes-oxley.htm.
The Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law on July 21, 2010 by President Barack Obama. The legislation set out to reshape the U.S. regulatory system in a number of areas including but not limited to consumer protection, trading restrictions, credit ratings, regulation of financial products, corporate governance and disclosure, and transparency. The full text of the Act is available at: /about/laws/wallstreetreform-cpa.pdf. (Please check the Classification Tables maintained by the US House of Representatives 申博官网 of the Law Revision Counsel for updates to any of the laws.) You can find links to all Commission rulemaking and reports issued under the Dodd Frank Act at: /spotlight/dodd-frank.shtml.
Jumpstart Our Business Startups (JOBS) Act
On April 5, 2012, the Jumpstart Our Business Startups (JOBS) Act was signed into law by President Barack Obama. The JOBS Act requires the 申博体育网址 to write rules and issue studies on capital formation, disclosure, and registration requirements. Cost-effective access to capital for companies of all sizes plays a critical role in our national economy, and companies seeking access to capital should not be hindered by unnecessary or overly burdensome regulations. For more information on the JOBS Act, see our Jumpstart Our Business Startups (JOBS) Act Spotlight page.