Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

National Association of Securities Dealers (NASD)

What it is:

The National Association of Securities Dealers (NASD) was a regulatory organization that oversaw the securities industry. The Financial Industry Regulatory Authority (FINRA) superseded NASD in 2007.

How it works (Example):

In July 2007, the NASD merged with the New York Stock Exchange's regulatory body to form FINRA. FINRA is not a governmental agency, though it works closely with the Securities and Exchange Commission on oversight.

FINRA oversees more than 5,000 securities firms and almost a million registered brokers and representatives. FINRA establishes rules, performs mediation functions and works to enhance investor protections. It also administers licensing examinations, such as the Series 7 and Series 64 exams, for financial professionals.

Why it Matters:

FINRA's job is to ensure that the financial markets operate fairly, efficiently and legally. FINRA cannot put anybody in jail, but it can fine rule-breakers and even revoke licenses. The organization has offices in Washington, D.C., and New York, as well as several district offices around the United States.