View source for U.S. Securities and Exchange Commission

{{short description|Government agency overseeing stock exchanges}}
{{redirect|Securities and Exchange Commission}}
{{pp-vandalism|small=yes}}
{{Use American English|date=June 2023}}
{{Use mdy dates|date=December 2016}}
{{Infobox government agency
| agency_name     = United States Securities and Exchange Commission
| logo            = US Security and Exchange Commission Office photo D Ramey Logan.jpg
| logo_caption    = U.S. Securities and Exchange Commission headquarters in [[Washington, D.C.]]
| seal            = Seal of the United States Securities and Exchange Commission.svg
| seal_width      = 175
| seal_caption    = Seal of the U.S. Securities and Exchange Commission
| formed          = {{start date and age|1934|6|6}}
| jurisdiction    = [[Federal government of the United States|United States federal government]]
| headquarters    = [[Washington, D.C.]], U.S.
| employees       = 4,807 (2022)
| chief1_name     = [[Paul S. Atkins]]
| chief1_position = Chairman
| website         = {{URL|https://www.sec.gov|sec.gov}}
| footnotes       = <ref>{{cite book |title=FY 2023 Congressional Budget Justification |page=16 |publisher=U.S. Securities and Exchange Commission |year=2022 |url=https://www.sec.gov/files/FY%202023%20Congressional%20Budget%20Justification%20Annual%20Performance%20Plan_FINAL.pdf}}</ref>
}}
{{US administrative law}}
The '''United States Securities and Exchange Commission''' ('''SEC''') is an [[independent agencies of the United States government|independent agency of the United States federal government]], created in the aftermath of the [[Wall Street crash of 1929]].<ref>{{Cite journal|last=Van Loo|first=Rory|date=2018-08-01|title=Regulatory Monitors: Policing Firms in the Compliance Era|url=https://scholarship.law.bu.edu/faculty_scholarship/265|journal=Faculty Scholarship|volume=119 |issue=2 |page=369 }}</ref><ref name=":3" /><ref name="divisions" /> Its primary purpose is to enforce laws against [[market manipulation]].<ref>{{cite web
 | url = https://www.sec.gov/Article/whatwedo.html
 | title = What We Do
 | last = SEC
 | date = June 10, 2013
 | website = SEC.gov
 | publisher = U.S. Securities and Exchange Commission
 | access-date = 2017-03-24
 }}</ref><ref>{{Cite journal|last=Hirst|first=Scott|date=2018-07-01|title=The Case for Investor Ordering|url=https://scholarship.law.bu.edu/faculty_scholarship/343|journal=The Harvard Law School Program on Corporate Governance Discussion Paper|volume=2017-13}}</ref>'''{{rp|2}}'''

Created by Section 4 of the [[Securities Exchange Act of 1934]] (now codified as {{usc|15|78d}} and commonly referred to as the Exchange Act or the 1934 Act), the SEC enforces the [[Securities Act of 1933]], the [[Trust Indenture Act of 1939]], the [[Investment Company Act of 1940]], the [[Investment Advisers Act of 1940]], and the [[Sarbanes–Oxley Act|Sarbanes–Oxley Act of 2002]], among other statutes.<ref>{{Cite web|title=Securities and Exchange Commission (SEC) – Overview, History & Setup|url=https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/securities-and-exchange-commission-sec/|access-date=2021-04-16|website=Corporate Finance Institute|language=en-US}}</ref>

==Overview==
{{more citations needed section|date=February 2017}}

The SEC has a three-part mission: to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation.<ref>{{cite web|url=http://investor.gov/introduction-markets/role-sec|title=The Role of the SEC|website=Investor.gov}}</ref>

To achieve its mandate, the SEC enforces the statutory requirement that [[public company|public companies]] and other regulated entities submit quarterly and [[annual report]]s, as well as other periodic disclosures. In addition to annual [[financial statements|financial reports]], company executives must provide a narrative account, called the "[[management discussion and analysis]]" (MD&A), that outlines the previous year of operations and explains how the company fared in that time period. MD&A usually addresses the upcoming year, outlining future goals and approaches to new projects.

Quarterly and semiannual reports from public companies are crucial for investors to make sound decisions when investing in [[capital market]]s. Unlike [[bank]]ing, [[investment]] in capital markets is not [[Federal Deposit Insurance Corporation|guaranteed]] by the federal government. The potential for large gains needs to be weighed against that of sizable losses. Mandatory disclosure of financial and other information about the [[issuer]] and the [[Security (finance)|security]] itself gives private individuals as well as large institutions the same fundamental facts about the public companies they invest in, thereby increasing public scrutiny while reducing [[insider trading]] and [[fraud]].

In an attempt to level the playing field for all investors, the SEC maintains an [[online and offline|online]] database called [[EDGAR]] (the Electronic Data Gathering, Analysis, and Retrieval system) from which investors can access information filed with the agency, such as reports. The same online system also accepts tips and complaints from investors to help the SEC track down violators of the securities laws, as well as offering publications on investment-related topics for public education. The SEC maintains a strict policy of refraining from commenting on the existence or status of any ongoing investigation.

==History==
===Background===
Prior to the enactment of the federal securities laws and the creation of the SEC, securities trading was governed by so-called [[blue sky law]]s. These laws were enacted and enforced at the state level and regulated the offering and sale of securities to protect the public from fraud. Though the specific provisions of these laws varied among states, they all required the registration of all securities offerings and sales, as well as of every U.S. [[stockbroker]] and brokerage firm.<ref name="bluesky">{{cite web |url=http://www.seclaw.com/bluesky.htm |title=Blue Sky laws |publisher=Seclaw.com |date=July 7, 2007 |access-date=March 1, 2013 |archive-date=December 9, 2017 |archive-url=https://web.archive.org/web/20171209204422/http://www.seclaw.com/bluesky.htm |url-status=dead }}</ref> However, blue sky laws were generally considered ineffective. For example, as early as 1915, the Investment Bankers Association told its members that they could circumvent blue sky laws by making securities offerings across state lines through the mail.<ref name="transwall">{{cite book|first=Joel|last=Seligman|title=The Transformation of Wall Street|pages=45, 51–52|publisher=Aspen|year=2003}}</ref>

===Founding===
{{See also|Securities Act of 1933|Securities Exchange Act of 1934}}
The SEC's authority was established by the Securities Act of 1933 and Securities Exchange Act of 1934; both laws are considered parts of [[Franklin D. Roosevelt]]'s [[New Deal]] program.

After the [[Pecora Commission]] hearings on abuses and frauds in securities markets, Congress passed the [[Securities Act of 1933]] ({{usc|15|77a}}), which federally regulates [[Primary market|original issues]] of securities across state lines, primarily by requiring that issuing companies register distributions prior to sale so that investors may access basic financial information and make informed decisions.<ref name="Act1933">{{cite web|url=https://www.sec.gov/about/laws/sa33.pdf |title=Securities Act of 1933 |access-date=March 1, 2013}}</ref> For the first year of the law's enactment, the enforcement of the statute rested with the Federal Trade Commission.

The subsequent Securities Exchange Act of 1934 ({{usc|15|78d}}) regulates [[secondary market]]s for securities. The 1934 Act regulates secondary trading between individuals and companies which are often unrelated to the original issuers of securities. Entities under the SEC's authority include securities exchanges with physical trading floors such as the [[New York Stock Exchange]], [[self-regulatory organization]]s, the [[Municipal Securities Rulemaking Board]], [[NASDAQ]], [[alternative trading system]]s, and any other persons engaged in transactions for the accounts of others. Section 4 of the 1934 Act transferred the FTC's enforcement authority under the 1933 Act to the newly created Securities and Exchange Commission and tasked the new commission with enforcing both acts.<ref name="Act1934">{{cite web|url=https://www.sec.gov/about/laws/sea34.pdf |title=Securities Exchange Act of 1934 |access-date=March 1, 2013}}</ref>

[[File:Joseph P. Kennedy, Sr. 1940.jpg|thumb|upright|left|[[Joseph P. Kennedy Sr.|Joseph P. Kennedy Sr]], the inaugural chairman of the SEC]]
In 1934, Roosevelt named his friend [[Joseph P. Kennedy]], a self-made multimillionaire, financier, and leader among the Irish-American community, as chairman of the SEC. Roosevelt chose Kennedy partly based on his experience on Wall Street.<ref>David Nasaw, ''The Patriarch: The Remarkable Life and Turbulent Times of Joseph P. Kennedy'' (2012), pp. 204–37.</ref> Two of the other five commissioners were [[James M. Landis]] and [[Ferdinand Pecora]]. Kennedy added a number of intelligent young lawyers to the SEC staff, including [[William O. Douglas]] and [[Abe Fortas]], both of whom later became Supreme Court justices.<ref name="Nassau, pp. 226">Nassau, ''The Patriarch,'' pp. 226–28</ref>

Kennedy's  team defined four missions for the new commission: (1) to restore investor confidence in the securities market, which had practically collapsed; (2) to restore integrity to securities markets by prosecuting and eliminating fraudulent and unsound practices targeting investors; (3) to end million-dollar insider trading by top officials of major corporations; and (4) to establish a complex and universal system of registration for securities sold in America, with a clear-cut set of deadlines, rules and guidelines. The SEC succeeded; Kennedy reassured the American business community that they would no longer be deceived and tricked and taken advantage of by Wall Street. He became a cheerleader for ordinary investors to return to the market and enable the economy to grow again.<ref name="Nassau, pp. 226"/>

Later SEC commissioners and chairmen include [[William O. Douglas]], [[Jerome Frank (lawyer)|Jerome Frank]], and [[William J. Casey]].

Since 1994, most registration statements (and associated materials) filed with the SEC can be accessed via the SEC's online system, EDGAR.<ref name="Act1933"/>

===21st century===
In 2019, the Securities and Exchange Commission Historical Society introduced an online gallery to illustrate changes in the US securities market structure since the 1930s. The online gallery features a narrative history supported by dozens of documents, papers, interviews, photos and videos.<ref name=":3">{{cite web|url=https://www.historyassociates.com/who-we-are/press-releases/securities-market-structure-exhibit/|title=History Associates Details the Evolution of Securities Market Structure in New Online Exhibit |publisher=History Associates |access-date=28 April 2019}}</ref>

===List of chairs===
{{See also|List of members of the Securities and Exchange Commission}}
{| class="wikitable sortable"
! scope="col" rowspan="2" | {{Abbr|No.|Number}}
! scope="col" rowspan="2" class="unsortable" | Portrait
! scope="col" rowspan="2" | Name
! scope="col" rowspan="2" | State of residency
! scope="col" colspan="3" | Term of office
! scope="col" rowspan="2" | Appointed by
|-
! scope="col" data-sort-type="date" | Term start
! scope="col" data-sort-type="date" | Term end
! scope="col" | Time in office
|-
! scope="row" |1
| [[File:Joseph P. Kennedy, Sr. 1938.jpg|75px|Joseph P. Kennedy Sr.]]
| {{sortname|Joseph P.|Kennedy Sr.}}
|[[Massachusetts]]
|June 30, 1934
|September 23, 1935
| {{Age in years and days nts|1934|06|30|1935|09|23|sc=y}}
| rowspan="6" |[[Franklin D. Roosevelt|Roosevelt]]
|-
! scope="row" |2
| [[File:James McCauley Landis cph.3b30465.jpg|75px|James M. Landis]]
| {{sortname|James M.|Landis}}
|Massachusetts
|September 23, 1935
|September 15, 1937
| {{Age in years and days nts|1935|09|23|1937|09|15|sc=y}}
|-
! scope="row" |3
| [[File:Face detail, Douglas dons robes of Supreme Court Justice. Washington, D.C., April 17. William Orville Douglas, 40 year old successor to retired Justice Louis D. Brandeis, today donned the robes of an LCCN2016875459 (cropped).tif|75px|William O. Douglas]]
| {{sortname|William O.|Douglas}}
|[[Connecticut]]
|August 17, 1937
|April 15, 1939
| {{Age in years and days nts|1937|08|17|1939|04|15|sc=y}}
|-
! scope="row" |4
|[[File:Jerome Frank.jpg|75px|Jerome Frank]]
| {{sortname|Jerome|Frank}}
|[[Illinois]]
|May 18, 1939
|April 9, 1941
| {{Age in years and days nts|1939|05|18|1941|04|09|sc=y}}
|-
! scope="row" |5
|[[File:EdwardCEicher.jpg|75px|Edward C. Eicher]]
| {{sortname|Edward C.|Eicher}}
|[[Iowa]]
|April 9, 1941
|January 20, 1942
| {{Age in years and days nts|1941|04|09|1942|01|20|sc=y}}
|-
! scope="row" |6
| [[File:Promoted. Washington, D.C., Oct. 30. Ganson Purcell has just been appointed Director of the Trading and Exchange Division of the Securities and Exchange Commission. Purcell, who succeeds LCCN2016872500.jpg|75px|Ganson Purcell]]
| {{sortname|Ganson|Purcell}}
|
|January 20, 1942
|June 30, 1946
| {{Age in years and days nts|1942|01|20|1946|06|30|sc=y}}
|-
! scope="row" |7
|
| {{sortname|James J.|Caffrey}}
|
|July 23, 1946
|December 31, 1947
| {{Age in years and days nts|1946|07|23|1947|12|31|sc=y}}
| rowspan="4" |[[Harry S. Truman|Truman]]
|-
! scope="row" |8
|
| {{sortname|Edmond M.|Hanrahan}}
|[[New York (state)|New York]]
|May 18, 1948
|November 3, 1949
| {{Age in years and days nts|1948|05|18|1949|11|03|sc=y}}
|-
! scope="row" |9
|
| {{sortname|Harry A.|McDonald}}
|
|November 4, 1949
|February 25, 1952
| {{Age in years and days nts|1949|11|04|1952|02|25|sc=y}}
|-
! scope="row" |10
| 
| {{sortname|Donald C.|Cook}}
| [[Michigan]]
| February 26, 1952
|June 17, 1953
| {{Age in years and days nts|1952|02|26|1953|06|17|sc=y}}
|-
! scope="row" |11
|
| {{sortname|Ralph H.|Demmler}}
|[[Pennsylvania]]
|June 27, 1953
|May 25, 1955
| {{Age in years and days nts|1953|06|27|1955|05|25|sc=y}}
| rowspan="3" |[[Dwight D. Eisenhower|Eisenhower]]
|-
! scope="row" |12
|
| {{sortname|J. Sinclair|Armstrong}}
|[[New York (state)|New York]]
|May 25, 1955
|June 27, 1957
| {{Age in years and days nts|1955|05|25|1957|06|27|sc=y}}
|-
! scope="row" |13
|
| {{sortname|Edward N.|Gadsby}}
|[[Massachusetts]]
| August 20, 1957
|March 26, 1961
| {{Age in years and days nts|1957|08|20|1961|03|26|sc=y}}
|-
! scope="row" |14
|
| {{sortname|William L.|Cary}}
|
|March 27, 1961
|August 20, 1964
| {{Age in years and days nts|1961|03|27|1964|08|20|sc=y}}
|[[John F. Kennedy|Kennedy]]
|-
! scope="row" |15
|
| {{sortname|Manuel F.|Cohen}}
|
|August 20, 1964
|February 22, 1969
| {{Age in years and days nts|1964|08|20|1969|02|22|sc=y}}
|[[Lyndon B. Johnson|Johnson]]
|-
! scope="row" |16
|[[File:Hamer H. Budge.jpg|75px|Hamer Budge]]
| {{sortname|Hamer H.|Budge}}
|[[Idaho]]
|February 22, 1969
|January 2, 1971
| {{Age in years and days nts|1969|02|22|1971|01|02|sc=y}}
| rowspan="4" |[[Richard Nixon|Nixon]]
|-
! scope="row" |17
|[[File:William-Casey.jpg|75px|William J. Casey]]
| {{sortname|William J.|Casey}}
|[[New York (state)|New York]]
|April 14, 1971
|February 2, 1973
| {{Age in years and days nts|1971|04|14|1973|02|02|sc=y}}
|-
! scope="row" |18
|
| {{sortname|G. Bradford|Cook}}
|[[Nebraska]]
|March 3, 1973
|May 16, 1973
| {{Age in years and days nts|1973|03|03|1973|05|16|sc=y}}
|-
! scope="row" |19
|
| {{sortname|Ray|Garrett Jr.}}
|[[Illinois]]
|August 6, 1973
|October 28, 1975
| {{Age in years and days nts|1973|08|06|1975|10|28|sc=y}}
|-
! scope="row" |20
|
| {{sortname|Roderick M.|Hills}}
|[[California]]
|October 28, 1975
|April 10, 1977
| {{Age in years and days nts|1975|10|28|1977|04|10|sc=y}}
|[[Gerald Ford|Ford]]
|-
! scope="row" |21
|
| {{sortname|Harold M.|Williams}}
|California
|April 18, 1977
|March 1, 1981
| {{Age in years and days nts|1977|04|18|1981|03|01|sc=y}}
|[[Jimmy Carter|Carter]]
|-
! scope="row" |22
|
| {{sortname|John S. R.|Shad}}
|
|May 6, 1981
|June 18, 1987
| {{Age in years and days nts|1981|05|06|1987|06|18|sc=y}}
| rowspan="2" |[[Ronald Reagan|Reagan]]
|-
! scope="row" |23
|
| {{sortname|David Sturtevant|Ruder}}
|[[Illinois]]
|August 7, 1987
|September 30, 1989
| {{Age in years and days nts|1987|08|07|1989|09|30|sc=y}}
|-
! scope="row" |24
|
| {{sortname|Richard C.|Breeden}}
|[[New York (state)|New York]]
|October 11, 1989
|May 7, 1993
| {{Age in years and days nts|1989|10|11|1993|05|07|sc=y}}
|[[George H. W. Bush|Bush Sr.]]
|-
! scope="row" |–
|[[File:SchapiroMary.jpg|75px|Mary Schapiro]]
| {{sortname|Mary|Schapiro}} (acting)
|New York
|May 7, 1993
|July 27, 1993
| {{Age in years and days nts|1993|05|07|1993|07|27|sc=y}}
| rowspan="2" |[[Bill Clinton|Clinton]]
|-
! scope="row" |25
|[[File:Arthur Levitt (Former Chairman, Securities and Exchange Commission).jpg|75px|Arthur Levitt]]
| {{sortname|Arthur|Levitt}}
|New York
|July 27, 1993
|February 9, 2001
| {{Age in years and days nts|1993|06|27|2001|02|09|sc=y}}
|-
! scope="row" |26
|<!-- Deleted image removed: [[File:HLP2004.jpg|75px|Harvey Pitt]] -->
| {{sortname|Harvey|Pitt}}
|New York
|August 3, 2001
|February 18, 2003
| {{Age in years and days nts|2001|08|03|2003|02|18|sc=y}}
| rowspan="3" |[[George W. Bush|Bush Jr.]]
|-
! scope="row" |27
|[[File:William Henry Donaldson.jpg|75px|William H. Donaldson]]
| {{sortname|William H.|Donaldson}}
|New York
|February 18, 2003
|June 30, 2005
| {{Age in years and days nts|2003|02|18|2005|06|30|sc=y}}
|-
! scope="row" |28
|[[File:ChrisCox.jpg|75px|Christopher Cox]]
| {{sortname|Christopher|Cox}}
|[[California]]
|August 3, 2005
|January 20, 2009
| {{Age in years and days nts|2005|08|03|2009|01|20|sc=y}}
|-
! scope="row" |29
|[[File:SchapiroMary.jpg|75px|Mary Schapiro]]
| {{sortname|Mary|Schapiro}}
|[[New York (state)|New York]]
|January 27, 2009
|December 14, 2012
| {{Age in years and days nts|2009|01|27|2012|12|14|sc=y}}
| rowspan="3" |[[Barack Obama|Obama]]
|-
! scope="row" |30
|[[File:Elisse Walter official portrait.jpg|75px|Elisse B. Walter]]
| {{sortname|Elisse B.|Walter}}
|New York
|December 14, 2012
|April 10, 2013
| {{Age in years and days nts|2012|12|14|2013|04|10|sc=y}}
|-
! scope="row" |31
|[[File:Official portrait of Mary Jo White.jpg|75px|Mary Jo White]]
| {{sortname|Mary Jo|White}}
|New York
|April 10, 2013
|January 20, 2017
| {{Age in years and days nts|2013|04|10|2017|01|20|sc=y}}
|-
! scope="row" |–
|[[File:Michael Piwowar official portrait.jpg|75px|Michael Piwowar]]
| {{sortname|Michael|Piwowar}} (acting)
|[[Washington D.C.]]
|January 20, 2017
|May 4, 2017
| {{Age in years and days nts|2017|01|20|2017|05|4|sc=y}}
| rowspan="3" |[[Donald Trump|Trump]]
|-
! scope="row" |32
|[[File:Jay Clayton.jpg|75px|Jay Clayton (attorney)]]
| {{sortname|Jay|Clayton|dab=attorney}}
|[[Pennsylvania]]
|May 4, 2017
|December 23, 2020
| {{Age in years and days nts|2017|05|04|2020|12|23|sc=y}}
|-
| scope="row" |–
|[[File:Elad Roisman official photo.jpg|75px|Elad Roisman]]
| {{sortname|Elad|Roisman}} (acting)
|[[Maine]]
|December 24, 2020
|January 20, 2021
| {{Age in years and days nts|2020|12|24|2021|01|20|sc=y}}
|-
| scope="row" |–
|[[File:Allison H. Lee official photo.jpg|75px|Allison Lee]]
| {{sortname|Allison|Lee}} (acting)
|Washington D.C.
|January 20, 2021
|April 17, 2021
| {{Age in years and days nts|2021|01|20|2021|04|17|sc=y}}
| rowspan="2" |[[Joe Biden|Biden]]
|-
! scope="row" |33
|[[File:GaryGenslerSEC.jpg|75px|Gary Gensler]]
| {{sortname|Gary|Gensler}}
|[[Maryland]]
|April 17, 2021
|January 20, 2025
| {{Age in years and days nts|2021|04|17|2025|01|20|sc=y}}
|-
| scope="row" |–
|[[File:Mark T. Uyeda, SEC Commissioner 2.jpg|75px|Mark Uyeda]]
| {{sortname|Mark|Uyeda}} (acting)
|California
|January 20, 2025
|April 21, 2025
| {{Age in years and days nts|2025|01|20|2025|04|21|sc=y}}
| rowspan="2" |Trump
|-
! scope="row" |34
|[[File:SEC Paul Atkins.jpg|75px|Paul S. Atkins]]
|{{sortname|Paul S.|Atkins}}
|[[Virginia]]
|April 21, 2025
|Present
| {{Age in years and days nts|2025|04|21|sc=y}}
|}

==Organizational structure==
===Commission members===
{{main|List of members of the Securities and Exchange Commission}}

The commission has five commissioners who are appointed by the president of the United States. No more than three commissioners may belong to the same political party. Their terms last five years and are staggered so that one commissioner's term ends on June 5 of each year. Service may continue up to eighteen additional months past term expiration.

The president also designates one of the commissioners as chairman, the SEC's top executive. However, the president does not possess the power to fire the appointed commissioners, a provision that was made to ensure the independence of the SEC. This issue arose during the [[2008 financial crisis]] and the [[John McCain 2008 presidential campaign]].

===Current commissioners===
The current board members {{as of|lc=y|df=US|2025|4|21}}:<ref>{{cite web |url=https://www.sec.gov/about/sec-commissioners |title=SEC Commissioners |author=<!--Not stated--> |date=<!--Not stated--> |website=SEC.gov |publisher=U.S. Securities and Exchange Commission |access-date=December 22, 2024}}</ref>
{| class="wikitable sortable" style="text-align:center"
! Position
! Name
! Party 
! Took office
! Term expires
|-
! Chair
| {{sortname|Paul S.|Atkins}}
| {{party shading/Republican}} | Republican
| {{dts|2025|04|21}}
| {{dts|2026|06|05}}
|-
! rowspan="4" | Member
| {{sortname|Hester|Peirce}}
| {{party shading/Republican}} | Republican
| {{dts|2018|01|11}}
| {{dts|2025|06|05}}
|-
| {{sortname|Caroline A.|Crenshaw}}
| {{party shading/Democratic}} | Democratic
| {{dts|2020|08|17}}
| {{dts|2024|06|05}}
|-
| {{sortname|Mark|Uyeda}}
| {{party shading/Republican}} | Republican
| {{dts|2022|06|30}}
| {{dts|2028|06|05}}
|-
| ''Vacant''
| {{n/a}}
| {{sdash}}
| {{dts|2027|06|05}}
|}

===Divisions===
[[File:U.S. Securities and Exchange Commission headquarters.JPG|thumb|U.S. Securities and Exchange Commission headquarters in [[Washington, D.C.]], near [[Washington Union Station]]]]
Within the SEC, there are six divisions, which is headquartered in [[Washington, D.C.]]

The SEC's divisions are:<ref name="divisions">[https://www.sec.gov/about/divisions] U.S. Securities and Exchange Commission</ref>
* Corporation Finance
* Trading and Markets
* Investment Management
* Enforcement
* Economic and Risk Analysis
* Examinations

'''Corporation Finance''' is the division that oversees the disclosure made by [[Public company|public companies]], as well as the registration of transactions, such as mergers, made by companies. The division is also responsible for operating EDGAR.

The '''Trading and Markets''' division oversees self-regulatory organizations (SRO's) such as the [[Financial Industry Regulatory Authority]] (FINRA) and [[Municipal Securities Rulemaking Board]] (MSRB) and all [[broker-dealer]] firms and [[investment banking|investment houses]]. This division also interprets proposed changes to regulations and monitors operations of the industry. In practice, the SEC delegates most of its enforcement and rulemaking authority to FINRA. In fact, all trading firms not regulated by other SROs must register as a member of FINRA. Individuals trading securities must pass exams administered by FINRA to become [[General Securities Representative Exam|registered representatives]].<ref name="finra">{{cite web|url=http://www.finra.com |title=National Association of Securities Dealers |publisher=Finra.com |access-date=March 1, 2013}}</ref>

The '''Investment Management''' Division oversees registered investment companies, which include [[mutual fund]]s, as well as registered [[investment advisor]]s. These entities are subject to extensive regulation under various federal securities laws.<ref>Lemke and Lins, ''Regulation of Investment Advisers'' (Thomson West, 2013 ed.); Lemke, Lins and Smith, ''Regulation of Investment Companies'' (Matthew Bender, 2013 ed.).</ref> The Division of Investment Management administers various federal securities laws, in particular, the Investment Company Act of 1940 and Investment Advisers Act of 1940.  This division's responsibilities include:<ref name="InvestManDivResponsibilities">{{cite web|url=https://www.sec.gov/about/whatwedo.shtml#org |title=How the SEC Protects Investors, Maintains Market Integrity, and Facilitates Capital Formation (Securities and Exchange Commission) |publisher=Sec.gov |access-date=March 1, 2013}}</ref>
* assisting the commission in interpreting laws and regulations for the public and SEC 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 SEC rules to new circumstances.

The '''Enforcement''' Division investigates violations of the securities laws and regulations to bring legal actions against alleged violators. It is the largest division in terms of both headcount and budget, and its resources have been increased by more than 50% since the [[2008 financial crisis]].<ref name="Klimczak Sison Prats Torres 2021">{{cite journal | last1=Klimczak | first1=Karol Marek | last2=Sison | first2=Alejo José G. | last3=Prats | first3=Maria | last4=Torres | first4=Maximilian B. | title=How to Deter Financial Misconduct if Crime Pays? | journal=Journal of Business Ethics | publisher=Springer Science and Business Media LLC | date=2021-05-06 | volume=179 | pages=205–222 | issn=0167-4544 | doi=10.1007/s10551-021-04817-0 | doi-access=free }}</ref> The SEC can bring a [[lawsuit|civil action]] in a [[United States district court|U.S. District Court]], or an [[administrative proceeding]] which is heard by an independent [[administrative law judge]] (ALJ). The SEC does not have criminal authority but may refer matters to state and federal prosecutors.

The '''Economic and Risk Analysis''' Division (DERA) was created in September 2009 to integrate financial economics and rigorous data analytics into the core mission of the SEC. The division is involved across the entire range of SEC activities, including policy-making, rule-making, enforcement, and examination. As the agency's "think tank", DERA relies on a variety of academic disciplines, quantitative and non-quantitative approaches, and knowledge of market institutions and practices to help the commission approach complex matters in a fresh light. DERA also assists in the commission's efforts to identify, analyze, and respond to risks and trends, including those associated with new financial products and strategies. Through the range and nature of its activities, DERA serves the critical function of promoting collaborative efforts throughout the agency and breaking through silos that might otherwise limit the impact of the agency's institutional expertise. The division's activities include providing detailed, high-quality economic and statistical analyzes, and specific subject-matter expertise to the commission and other divisions/offices and developing customized, analytic tools and analyzes to proactively detect market risks indicative of possible violations of the federal securities laws. Using data, DERA staff create analytic programs designed to detect patterns identifying risks, enabling commission divisions and offices to deploy scarce resources targeting possible misconduct. DERA also houses the commission's chief economist.<ref>{{Cite web |title= Economic and Risk Analysis |url=https://www.sec.gov/dera |access-date=2023-11-10 |website=SEC.gov}}</ref>

The Division of '''Examinations''' conducts the SEC's National Exam Program. The division's mission is to protect investors, ensure market integrity and support responsible capital formation through risk-focused strategies that: (1) improve compliance; (2) prevent fraud; (3) monitor risk; and (4) inform policy. The results of the division's examinations are used by the SEC to inform rule-making initiatives, identify and monitor risks, improve industry practices and pursue misconduct.

===Regional offices===
There are 11 regional offices throughout the US, which are listed below along with the name of the respective regional director.<ref>{{cite web|url=https://www.sec.gov/page/sec-regional-offices|title=SEC Regional Offices|work=U.S. Securities and Exchange Commission|access-date=July 7, 2023}}</ref>

{{div-col|colwidth=18em|content=
*Atlanta – Nekia Hackworth Jones 
*Boston – Silvestre A. Fontes 
*Chicago – Daniel Gregus 
*Denver – Jason Burt 
*Fort Worth – Eric R. Werner 
*Los Angeles – Katharine Zoladz, J. Cindy Eson 
*Miami – Eric I. Bustillo
*New York City – Antonia M. Apps 
*Philadelphia – Nicholas P. Grippo 
*Salt Lake City – Tracy S. Combs 
*San Francisco – Monique Winkler
}}

Among the SEC's offices are:
* The ''Office of General Counsel'', which acts as the agency's "lawyer" before federal appellate courts and provides legal advice to the commission and other SEC divisions and offices;
* The ''Office of the Chief Accountant'', which establishes and enforces accounting and auditing policies set by the SEC.  This office has played a role in such areas as working with the [[Financial Accounting Standards Board]] to develop [[Generally Accepted Accounting Principles]], the [[Public Company Accounting Oversight Board]] in developing audit requirements, and the [[International Accounting Standards Board]] in advancing the development of [[International Financial Reporting Standards]];
* The ''Office of Compliance, Inspections and Examinations'', which inspects [[broker-dealer]]s, [[stock exchange]]s, [[credit rating agency|credit rating agencies]], registered investment companies, including both closed-end and open-end ([[mutual fund]]s) investment companies, [[money fund]]s. and [[Registered Investment Advisor]]s;
* The ''Office of International Affairs'', which represents the SEC abroad and which negotiates international enforcement information-sharing agreements, develops the SEC's international regulatory policies in areas such as mutual recognition, and helps develop international regulatory standards through organizations such as the [[International Organization of Securities Commissions]] and the [[Financial Stability Forum]]; and
* The ''Office of Information Technology'', which supports the commission and staff in information technology, including application development, infrastructure operations. and engineering, user support, IT program management, capital planning, security, and enterprise architecture.
* The ''[[Office of Inspector General (United States)|Inspector General]]''. The  SEC announced in January 2013 that it had named [[Carl Hoecker]] the new inspector general.<ref>{{cite web|last=Schroeder |first=Peter |url=https://thehill.com/policy/finance/140642-sec-names-new-inspector-general/ |title=SEC names new inspector general – The Hill's On The Money |work=The Hill |date=January 29, 2013 |access-date=March 1, 2013}}</ref><ref>{{cite web|url=https://www.sec.gov/news/press/2012/2012-106.htm|title=Jon Rymer Named Interim Inspector General|website=SEC.gov}}</ref> He has a staff of 22.<ref>{{cite web |last1=Greene |first1=Jenna |title=The Conversation Stopper: SEC Inspector General H. David Kotz |url=http://www.law.com/jsp/cc/PubArticleCC.jsp?id=1202508312296 |website=Corporate Counsel |publisher=[[ALM (company)|ALM Media Properties, LLC]] |access-date=May 21, 2021 |language=en |date=July 27, 2011}}</ref>
* The ''[[SEC Office of the Whistleblower]]'' provides assistance and information from a whistleblower who knows of possible securities law violations: this can be among the most powerful weapons in the law enforcement arsenal of the Securities and Exchange Commission.<ref>{{cite web|url=https://www.sec.gov/whistleblower |title=Office of the SEC Whistleblower |publisher=Sec.gov |access-date=2013-12-05}} {{PD-notice}}</ref> Created by Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act [[Dodd–Frank Wall Street Reform and Consumer Protection Act]] amended the Securities Exchange Act of 1934 (the "Exchange Act") by, among other things, adding Section 21F, entitled "Securities Whistleblower Incentives and Protection".<ref>{{cite web |title=Regulation 21F: Securities Whistleblower Incentives and Protection |url=https://www.sec.gov/about/offices/owb/reg-21f.pdf |publisher=U.S. Securities and Exchange Commission |access-date=May 21, 2021}}</ref> Section 21F directs the commission to make monetary awards to eligible individuals who voluntarily provide original information that leads to successful commission enforcement actions resulting in the imposition of monetary sanctions over $1,000,000, and certain successful related actions.<ref>{{cite web |url=https://www.sec.gov/about/offices/owb/annual-report-2012.pdf |title=Annual Report on the Dodd-Frank Whistleblower Program Fiscal Year 2012 |date=November 2012 |website=U.S. Securities and Exchange Commission}} {{PD-notice}}</ref>

==Communications==
===Comment letters===
Comment letters are issued by the SEC's Division of Corporation Finance in response to a company's public filing.<ref name="secgovcommentletters">{{cite web|url=https://www.sec.gov/answers/commentletters.htm |title=Fast Answers: Comment Letters |publisher=SEC.gov |access-date=October 16, 2015}}</ref>  This letter, initially private, contains an itemized list of requests from the SEC.  Each comment in the letter asks the filer to provide additional information, modify their submitted filing, or change the way they disclose in future filings.  The filer must reply to each item in the comment letter.  The SEC may then reply back with follow-up comments.<ref name="secgovfilingprocess">{{cite web|url=https://www.sec.gov/divisions/corpfin/cffilingreview.htm |title=Filing Review Process| publisher=SEC.gov |access-date=October 16, 2015}}</ref>  This correspondence is later made public.

In October 2001 the SEC wrote to [[CA, Inc.]], covering 15 items, mostly about CA's accounting, including 5 about [[revenue recognition]].<ref name="nytimesgavin">{{cite web |url=https://www.nytimes.com/2006/05/28/business/yourmoney/28gavin.html?pagewanted=print |title=Deafened by the S.E.C.'s Silence, He Sued|author=Gretchen Morgenson|date=May 28, 2008|newspaper=The New York Times}}</ref> The [[chief executive officer]] of CA, to whom the letter was addressed, pleaded guilty to fraud at CA in 2004.<ref name="nytimesgavin" />

In June 2004, the SEC announced that it would publicly post all comment letters, to give investors access to the information in them.  An analysis of regulatory filings  in May 2006 over the prior 12 months indicated, that the SEC had not accomplished what it said it would do.  The analysis found 212 companies that had reported receiving comment letters from the SEC, but only 21 letters for these companies were posted on the SEC's website. John W. White, the head of the Division of Corporation Finance, told the ''New York Times'' in 2006: "We have now resolved the hurdles of posting the information... We expect a significant number of new postings in the coming months."<ref name="nytimesgavin" />

===No-action letters===
[[No-action letter]]s are letters by the SEC staff indicating that the staff will not recommend to the commission that the SEC undertake enforcement action against a person or company if that entity engages in a particular action. These letters are sent in response to requests made when the legal status of an activity is not clear. These letters are publicly released and increase the body of knowledge on what exactly is and is not allowed.  They represent the staff's interpretations of the securities laws and, while persuasive, are not binding on the courts.

One such use, from 1975 to 2007, was with the [[nationally recognized statistical rating organization]] (NRSRO), a [[credit rating agency]] that issues [[bond credit rating|credit ratings]] that the SEC permits other financial firms to use for certain regulatory purposes.

==Freedom of Information Act processing performance==
In the latest [[Center for Effective Government]] analysis of 15 federal agencies which receive the most [[Freedom of Information Act (United States)|Freedom of Information Act]] (FOIA) requests published in 2015 (using 2012 and 2013 data, the most recent years available), the SEC was among the 5 lowest performers, earned a D− by scoring 61 out of a possible 100 points, i.e. did not earn a satisfactory overall grade. It had deteriorated from a D− in 2013.<ref>[http://www.foreffectivegov.org/access-to-information-scorecard-2015/ Making the Grade: Access to Information Scorecard 2015] {{Webarchive|url=https://web.archive.org/web/20190811044220/https://www.foreffectivegov.org/access-to-information-scorecard-2015 |date=August 11, 2019 }} March 2015, 80 pages, [[Center for Effective Government]], retrieved 21 March 2016</ref>

==Operations==

=== List of major SEC enforcement actions (2009–12) ===
{{Main|List of major SEC enforcement actions (2009–12)}}

The SEC's Enforcement Division took a number of major actions in 2009–12.

===Regulatory action in the credit crunch===
The SEC announced on September 17, 2008, strict new rules to prohibit all forms of "[[naked short selling]]" as a measure to reduce volatility in turbulent markets.<ref>{{cite web|url=http://www.thestreet.com/story/10437867/1/sec-bans-naked-short-selling.html?puc=googlefi&cm_ven=GOOGLEFI&cm_cat=FREE&cm_ite=NA|title=Naked-Shorts Ban Gets Chilly Reception|author=Lauren Tara LaCapra|date=September 17, 2008|newspaper=The street|access-date=September 18, 2008|archive-url=https://web.archive.org/web/20080920051018/http://www.thestreet.com/story/10437867/1/sec-bans-naked-short-selling.html?puc=googlefi&cm_ven=GOOGLEFI&cm_cat=FREE&cm_ite=NA|archive-date=September 20, 2008|url-status=dead}}</ref><ref>{{cite news |url=https://money.cnn.com/2008/09/17/news/companies/sec_short_selling/ |title=Regulator enacts new ruling banning 'naked' short selling on all public companies. | work=CNN | date=September 17, 2008 | access-date=May 26, 2010 | first=David | last=Ellis}}</ref>

The SEC investigated cases involving individuals attempting to manipulate the market by passing false rumors about certain financial institutions.  The commission has also investigated trading irregularities and abusive [[short-selling]] practices.  [[Hedge fund]] managers, broker-dealers, and institutional investors were also asked to disclose under oath certain information pertaining to their positions in [[credit default swap]]s.  The commission also negotiated the largest settlements in the history of the SEC (approximately $51 billion in all) on behalf of investors who purchased [[auction rate security|auction rate securities]] from six different financial institutions.

===Regulatory failures===
The SEC has been criticized "for being too 'tentative and fearful' in confronting wrongdoing on [[Wall Street]]", and for doing "an especially poor job of holding executives accountable".<ref>{{Cite episode
| publisher = PBS
| credits = Jason Breslow (Director)
| title = Is SEC "Fearful" of Wall Street? Agency Insider Says Yes
| work = The Untouchables
| series = [[Frontline (U.S. TV series)]]
| access-date = December 14, 2014
| date = April 8, 2014
| url = https://www.pbs.org/wgbh/frontline/article/is-sec-fearful-of-wall-street-agency-insider-says-yes/
}}</ref><ref>{{Cite web
| last = Schmidt
| first = Robert
| title = SEC Goldman Lawyer Says Agency Too Timid on Wall Street Misdeeds
| work = Bloomberg
| access-date = December 14, 2014
| date = April 8, 2014
| url = https://www.bloomberg.com/news/2014-04-08/sec-goldman-lawyer-says-agency-too-timid-on-wall-street-misdeeds.html
}}</ref><ref>{{Cite web
| last = Kidney
| first = Jim
| title = Retirement Remarks
| work = SEC Union, NTEU Chapter 293
| access-date = November 20, 2014
| date = 2014
| url = http://www.secunion.org/files/RetirementRemarks.pdf
| archive-url = https://web.archive.org/web/20140912014828/http://www.secunion.org/files/RetirementRemarks.pdf
| url-status = dead
| archive-date = 2014-09-12
}}</ref>

[[Christopher Cox]], the former SEC chairman, has recognized the organization's multiple failures in relation to the [[Bernard Madoff]] fraud.<ref>{{cite web|last=Chung |first=Joanna |url=http://www.ft.com/cms/s/92bd4c68-cbd7-11dd-ba02-000077b07658,Authorised=false.html |archive-url=https://ghostarchive.org/archive/20221210/http://www.ft.com/cms/s/92bd4c68-cbd7-11dd-ba02-000077b07658,Authorised=false.html |archive-date=December 10, 2022 |url-access=subscription |url-status=live |title=Financial Times: SEC chief admits to failures in Madoff case |publisher=Ft.com |date=December 17, 2008 |access-date=March 1, 2013}}</ref> Starting with an investigation in 1992 into a Madoff [[feeder fund]] that only invested with Madoff, and which, according to the SEC, promised "curiously steady" returns, the SEC did not investigate indications that something was amiss in Madoff's investment firm.<ref name="Forbes12.23">{{cite magazine
  | last =Moyer  | first =Liz | title =Could SEC Have Stopped Madoff Scam In 1992?
  | magazine =Forbes | date =December 23, 2008
  | url =https://www.forbes.com/business/2008/12/23/madoff-fraud-sec-biz-wall-cx_lm_1223madoff.html
  | access-date =December 24, 2008|archive-url=https://web.archive.org/web/20090201052739/http://www.forbes.com/2008/12/23/madoff-fraud-sec-biz-wall-cx_lm_1223madoff.html|archive-date=February 1, 2009}}</ref>  The SEC has been accused of missing numerous red flags and ignoring tips on Madoff's alleged fraud.<ref name="fort wayne sec">{{cite news|url=http://www.fwdailynews.com/articles/2008/12/26/greater_fort_wayne/features/opinion/letters_to_the_editor/hid108593sect_34f8ccf755b92af298.txt |title=Madoff exposes double standard for Ponzi schemes |work=Bloomberg News |publisher=Greater Fort Wayne Business Weekly |access-date=December 26, 2008 |last=Weil |first=Jonathan }}{{dead link|date=June 2016|bot=medic}}{{cbignore|bot=medic}}</ref>

As a result, Cox said that an investigation would ensue into "all staff contact and relationships with the Madoff family and firm, and their impact, if any, on decisions by staff regarding the firm".<ref name="forbes sec">{{cite magazine| url=https://www.forbes.com/intelligentinvesting/2008/12/20/intelligent-investing-madoff-sec-fraud-panelDec22.html?partner=contextstory| archive-url=https://archive.today/20130102205826/http://www.forbes.com/intelligentinvesting/2008/12/20/intelligent-investing-madoff-sec-fraud-panelDec22.html?partner=contextstory| url-status=dead| archive-date=January 2, 2013|title=Love, Madoff And The SEC|magazine=Forbes|access-date=December 24, 2008|last=Serchuk|first=David|date=December 22, 2008}}</ref>  SEC assistant director of the Office of Compliance Investigations [[Eric Swanson]] had met Madoff's niece, [[Shana Madoff]], when Swanson was conducting an SEC examination of whether Bernard Madoff was running a [[Ponzi scheme]] because she was the firm's compliance attorney.  The investigation was closed, and Swanson subsequently left the SEC, and married Shana Madoff.<ref>{{cite news| url=https://www.nytimes.com/2008/12/19/business/19swanson.html?_r=0 | work=The New York Times | first=Stephen | last=Labaton | title=Unlikely Player Pulled Into Madoff Swirl | date=December 19, 2008}}</ref>

Approximately 45 percent of institutional investors thought that better oversight by the SEC could have prevented the Madoff fraud.<ref>{{cite web|url=http://www.briskfox.com/open/years/2009_q1/do_h_c44818.php|title=Little faith in regulators and rating agencies, as LP demand for alternatives cools off, finds survey|access-date=March 17, 2009|archive-date=July 8, 2011|archive-url=https://web.archive.org/web/20110708094209/http://www.briskfox.com/open/years/2009_q1/do_h_c44818.php|url-status=dead}}</ref> [[Harry Markopolos]] complained to the SEC's Boston office in 2000, telling the SEC staff they should investigate Madoff because it was impossible to legally make the profits Madoff claimed using the investment strategies that he said he used.<ref>{{cite book | last = Markopolos | first = H | author-link = Harry Markopolos | title = No One Would Listen: A True Financial Thriller | isbn = 978-0-470-55373-2 | publisher = [[John Wiley & Sons]] | year = 2010 | pages = [https://archive.org/details/noonewouldlisten00mark/page/55 55–60] }}</ref>

In June 2010, the SEC settled a [[wrongful termination]] lawsuit with former SEC enforcement lawyer [[Gary J. Aguirre]], who was terminated in September 2005 following his attempt to subpoena Wall Street figure [[John J. Mack]] in an insider trading case involving hedge fund [[Pequot Capital Management]];<ref name=Blaylock2010>Blaylock D. (June 2010). [http://www.commondreams.org/newswire/2010/06/29-6 SEC Settles with Aguirre] {{Webarchive|url=https://web.archive.org/web/20120111110422/http://www.commondreams.org/newswire/2010/06/29-6 |date=January 11, 2012 }}. Government Accountability Project.</ref> [[Mary Jo White]], who later served as chair of the 
SEC, was at the time representing Morgan Stanley and was involved in this case.<ref>[https://www.rollingstone.com/politics/politics-news/choice-of-mary-jo-white-to-head-sec-puts-fox-in-charge-of-hen-house-185463/ Choice of Mary Jo White to Head SEC Puts Fox In Charge of Hen House]. ''Rolling Stone''.</ref> While the insider case was dropped at the time, a month prior to the SEC's settlement with Aguirre the SEC filed charges against Pequot.<ref name=Blaylock2010/> The Senate released a report in August 2007 detailing the issue and calling for reform of the SEC.<ref name=SenateFiringReport>Committee on Finance, Committee on the Judiciary.[http://finance.senate.gov/library/prints/download/?id=f9d94204-7602-49f7-8bab-cb932c05310e The Firing of an SEC Attorney and the Investigation of Pequot Capital Management]. U.S. Government Printing Office.</ref>

On September 26, 2016, Democratic senator [[Mark Warner]] sent a letter to the SEC, asking them to evaluate whether the current disclosure regime was adequate, citing the low number of companies' disclosures to date.<ref>{{cite web|title=20160926 Letter to SEC on Yahoo Breach|url=https://www.scribd.com/document/325367178/20160926-Letter-to-SEC-on-Yahoo-Breach|access-date=13 December 2016}}</ref><ref>{{cite news|last1=Volz|first1=Dustin|title=Yahoo hack may become test case for SEC data breach disclosure rules|url=https://www.reuters.com/article/us-yahoo-cyber-disclosure-idUSKCN1202MG|work=Reuters|access-date=13 December 2016}}</ref><ref>{{cite web|title=Sen. Warner Calls on SEC to Investigate Disclosure of Yahoo Breach|url=http://www.warner.senate.gov/public/index.cfm/pressreleases?ContentRecord_id=AC6EC18E-F309-404B-BF2D-9F60CD9884E8|access-date=13 December 2016|date=26 September 2016}}</ref>

====Inspector General office failures====
In 2009, the [[Project on Government Oversight]], a government watchdog group, sent a letter to Congress criticizing the SEC for failing to implement more than half of the recommendations made to it by its [[#Organizational structure|Inspector General]].<ref>Johnson, Fawn. (December 17, 2009) [http://www.nasdaq.com/aspx/stock-market-news-story.aspx?storyid=200912171553dowjonesdjonline000580&title=group-alleges-slack-sec-response-to-internal-watchdog "Group Alleges Slack SEC Response to Internal Watchdog"]. NASDAQ.</ref> According to POGO, in the prior two years, the SEC had taken no action on 27 out of 52 recommended reforms suggested in Inspector General reports, and still had a "pending" status on 197 of the 312 recommendations made in audit reports. Some of the recommendations included imposing disciplinary action on SEC employees who receive improper gifts or other favors from financial companies, and investigating and reporting the causes of the failures to detect the Madoff ponzi scheme.<ref>Brian, Danielle. (December 16, 2009) [http://www.pogo.org/pogo-files/letters/financial-oversight/er-fra-20091216.html "POGO Letter to SEC Chairman Mary Schapiro regarding SEC's failure to act on hundreds of Inspector General recommendations"] {{webarchive|url=https://web.archive.org/web/20100804151139/http://www.pogo.org/pogo-files/letters/financial-oversight/er-fra-20091216.html |date=August 4, 2010 }}. The Project On Government Oversight Website.</ref>

In a 2011 article by [[Matt Taibbi]] in ''[[Rolling Stone]]'', former SEC employees were interviewed and commented negatively on the SEC's [[Office of the Inspector General]] (OIG). Going to the OIG was "well-known to be a career-killer".<ref name=taibi20118>[https://www.rollingstone.com/politics/news/is-the-sec-covering-up-wall-street-crimes-20110817  Is the SEC Covering Up Wall Street Crimes?] {{Webarchive|url=https://web.archive.org/web/20170822123316/http://www.rollingstone.com/politics/news/is-the-sec-covering-up-wall-street-crimes-20110817 |date=August 22, 2017 }}, Matt Taibbi, 2011 August 17</ref>

Because of concerns raised by [[David P. Weber]], former SEC Chief Investigator, regarding conduct by SEC Inspector General [[H. David Kotz]], Inspector General [[David C. Williams (Inspector General)|David C. Williams]] of the [[U.S. Postal Service]] was brought in to conduct an independent, outside review of Kotz's alleged improper conduct in 2012.<ref name="bloomberg1">{{cite news|last=Schmidt |first=Robert |url=https://www.bloomberg.com/news/2013-01-25/sec-said-to-back-hire-of-u-s-capitol-police-inspector-general.html |title=SEC Said to Back Hire of U.S. Capitol Police Inspector General |publisher=Bloomberg |date=January 25, 2013 |access-date=February 10, 2013}}</ref> Williams concluded in his 66-page Report that Kotz violated ethics rules by overseeing probes that involved people with whom he had [[conflicts of interest]] due to "personal relationships".<ref name="bloomberg1"/><ref name="bloomberg2"/>  The report questioned Kotz's work on the Madoff investigation, among others, because Kotz was a "very good friend" with Markopolos.<ref name="bloomberg2">{{cite news|last=Schmidt |first=Robert |author2=Joshua Gallu |url=https://www.bloomberg.com/news/2012-10-06/former-sec-watchdog-kotz-violated-ethics-rules-review-finds-1-.html |title=Former SEC Watchdog Kotz Violated Ethics Rules, Review Finds |publisher=Bloomberg |date= October 26, 2012|access-date=February 10, 2013}}</ref><ref name="businessweek2">{{cite magazine|url=http://www.businessweek.com/news/2012-10-06/former-sec-watchdog-kotz-violated-ethics-rules-review-finds |archive-url=https://web.archive.org/web/20130502095153/http://www.businessweek.com/news/2012-10-06/former-sec-watchdog-kotz-violated-ethics-rules-review-finds |url-status=dead |archive-date=May 2, 2013 |author= Robert Schmidt and Joshua Gallu |title=Former SEC Watchdog Kotz Violated Ethics Rules, Review Finds |magazine=Business Week |date= October 6, 2012 |access-date=February 12, 2013}}</ref><ref name="huffingtonpost1">{{cite news|url=https://www.huffingtonpost.com/2012/11/15/davir-weber-lawsuit_n_2140452.html |title=David Weber Lawsuit: Ex-SEC Investigator Accused Of Wanting To Carry A Gun At Work, Suing For $20 Million|author=Sarah N. Lynch |work=[[The Huffington Post]] |date= November 15, 2012|access-date=February 10, 2013}}</ref><ref name="huffingtonpost2">{{cite news |url=https://www.huffingtonpost.com/2012/10/05/david-kotz-conflict-of-interest_n_1944205.html |title=David Kotz, Ex-SEC Inspector General, May Have Had Conflicts Of Interest |work=[[The Huffington Post]] |date=October 5, 2012|access-date=February 10, 2013}}</ref> It concluded that while it was unclear when Kotz and Markopolos became friends, it would have violated U.S. ethics rules if their relationship began before or during Kotz's Madoff investigation.<ref name="bloomberg2"/>  The report also found that Kotz himself "appeared to have a conflict of interest" and should not have opened his Standford investigation, because he was friends with a female attorney who represented victims of the fraud.<ref name="businessweek2"/>

==== Destruction of documents ====
According to former SEC employee and [[whistleblower]] Darcy Flynn, also reported by Taibbi, the agency routinely destroyed thousands of documents related to preliminary investigations of alleged crimes committed by [[Deutsche Bank]], [[Goldman Sachs]], [[Lehman Brothers]], [[SAC Capital]], and other financial companies involved in the [[Great Recession]] that the SEC was supposed to have been regulating. The documents included those relating to "[[Matters Under Inquiry]]", or MUI, the name the SEC gives to the first stages of the investigation process. The tradition of destruction began as early as the 1990s. This SEC activity eventually caused a conflict with the [[National Archives and Records Administration]] when it was revealed to them in 2010 by Flynn. Flynn also described a meeting at the SEC in which top staff discussed ''refusing to admit the destruction had taken place, because it was possibly illegal''.<ref name=taibi20118/>

Iowa Republican Senator [[Charles Grassley]], among others, took note of Flynn's call for protection as a whistleblower, and the story of the agency's document-handling procedures. The SEC issued a statement defending its procedures. [[NPR]] quoted [[University of Denver]] [[Sturm College of Law]] professor [[J. Robert Brown Jr.|Jay Brown]] as saying: "My initial take on this is it's a tempest in a teapot," and [[Jacob Frenkel]], a securities lawyer in the Washington, D.C., area, as saying in effect "there's no allegation the SEC tossed sensitive documents from banks it got under subpoena in high-profile cases that investors and lawmakers care about". NPR concluded its report:

<blockquote>The debate boils down to this: What does an investigative record mean to Congress? And the courts? Under the law, those investigative records must be kept for 25 years. But federal officials say no judge has ruled that papers related to early-stage SEC inquiries are investigative records. The SEC's inspector general says he's conducting a thorough investigation into the allegations. [Kotz] tells NPR that he'll issue a report by the end of September.<ref>Johnson, Carrie, [https://www.npr.org/2011/08/18/139758303/sec-documents-destroyed-employee-tells-congress "SEC Documents Destroyed, Employee Tells Congress"], National Public Radio (transcript and audio), August 18, 2011. Retrieved August 18, 2011.</ref></blockquote>

==== SEC and cryptocurrency ====
On June 5, 2023, the SEC filed 13 charges against [[Binance]] entities and its founder [[Changpeng Zhao]], citing allegations of mishandling customer funds and operating without proper registration.<ref>{{Cite news |last1=Weinstein |first1=Austin |last2=Versprille |first2=Allyson |last3=Beyoud |first3=Lydia |date=June 5, 2023 |title=SEC Sues Binance and CEO Zhao for Breaking US Securities Rules |url=https://www.bloomberg.com/news/articles/2023-06-05/sec-sues-binance-and-ceo-zhao-for-breaking-us-securities-rules |url-access=subscription |url-status=live |archive-url=https://archive.today/20230605224248/https://www.bloomberg.com/news/articles/2023-06-05/sec-sues-binance-and-ceo-zhao-for-breaking-us-securities-rules |archive-date=5 June 2023 |access-date=August 5, 2023 |website=[[Bloomberg News]]}}</ref><ref>{{Cite news |last1=Goldstein |first1=Matthew |last2=Flitter |first2=Emily |last3=Yaffe-Bellany |first3=David |date=June 5, 2023 |title=S.E.C. Accuses Binance of Mishandling Funds and Lying to Regulators |url=https://www.nytimes.com/2023/06/05/business/sec-binance-charges.html |url-access=subscription |url-status=live |archive-url=https://web.archive.org/web/20230805190830/https://www.nytimes.com/2023/06/05/business/sec-binance-charges.html |archive-date=August 5, 2023 |access-date=August 5, 2023 |work=The New York Times}}</ref> The following day, the SEC charged [[Coinbase]] for operating as an unregistered securities exchange, broker, and clearing agency, further signaling its intensified scrutiny of major players in the industry.<ref>{{Cite web |date=June 6, 2023 |title=SEC Charges Coinbase for Operating as an Unregistered Securities Exchange, Broker, and Clearing Agency |url=https://www.sec.gov/news/press-release/2023-102 |access-date=2023-07-07 |website=SEC.gov}}</ref><ref>{{cite web |last1=Ponciano |first1=Jonathan |date=June 6, 2023 |title=SEC Sues Coinbase—Alleges Crypto Trading Platform Operated As Unregistered Exchange Since 2019 |url=https://www.forbes.com/sites/jonathanponciano/2023/06/06/sec-sues-coinbase-alleges-crypto-trading-platform-operated-as-unregistered-exchange-since-2019/ |url-access=subscription |url-status=live |archive-url=https://archive.today/20240405180848/https://www.forbes.com/sites/jonathanponciano/2023/06/06/sec-charges-coinbase-alleges-crypto-trading-platform-operated-as-unregistered-exchange-since-2019/?sh=58d33ddc606e |archive-date=5 April 2024 |access-date=August 6, 2023 |website=[[Forbes]]}}</ref>

A key point of contention between the SEC and the crypto industry lies in defining what constitutes a security. The SEC applies the [[SEC v. W. J. Howey Co.|Howey Test]], derived from a 1946 U.S. Supreme Court decision, which defines a security as "an investment of money in a common enterprise with profits to come solely from the efforts of others."<ref>{{Cite news |last=Godoy |first=Jody |date=2023-06-07 |title=What makes a crypto asset a security in the U.S.? |url=https://www.reuters.com/business/finance/what-makes-crypto-asset-security-us-2023-06-07/ |url-status=live |archive-url=https://archive.today/20230608070216/https://www.reuters.com/business/finance/what-makes-crypto-asset-security-us-2023-06-07/ |archive-date=8 June 2023 |access-date=2023-07-07 |work=Reuters |language=en}}</ref> The agency has classified many crypto assets as securities based on this test, asserting that their value often depends on the efforts of developers or other central parties behind blockchain projects. Critics argue that the test is outdated and ill-suited to the decentralized nature of cryptocurrencies, leaving regulatory definitions unclear and fostering uncertainty. Research by economists found that unpredictable SEC enforcement actions under [[Gary Gensler|Gensler]], classifying [[Cryptocurrency|cryptocurrencies]] as securities without clear guidelines, caused prolonged destabilization in crypto markets.<ref>{{Cite journal |last=Saggu |first=Aman |last2=Ante |first2=Lennart |last3=Kopiec |first3=Kaja |date=2025-02-01 |title=Uncertain Regulations, Definite Impacts: The Impact of the U.S. Securities and Exchange Commission's Regulatory Interventions on Crypto Assets |url=https://linkinghub.elsevier.com/retrieve/pii/S1544612324014429 |journal=Finance Research Letters |volume=72 |pages=106413 |doi=10.1016/j.frl.2024.106413 |issn=1544-6123|arxiv=2412.02452 }}</ref> Unclear guidelines raise doubts about the agency's ability to maintain fair and orderly markets.

'''SEC and Cypersecurity Risk'''

On July 26, 2023, the SEC adopted the '''''Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure rule''''' which was designed to encourage public companies to transparently and effectively manage cybersecurity risk.

====Climate disclosure rule====

In 2024, the SEC decided on a climate disclosure rule, The Enhancement and Standardization of Climate-Related Disclosures for Investors. It requires companies to disclose information on their risk to be impacted by [[climate change]] and a company's risks to profit by a growing number of climate change regulations, concerning direct and indirect [[greenhouse gas emission]]s produced.<ref>{{Cite news |last=Delouya |first=Samantha |date=2023-12-30 |title=A new rule requiring companies to climate risk is coming in 2024. Here's what you need to know. |url=https://edition.cnn.com/2023/12/30/business/sec-climate-change-rule-2024/index.html |access-date=2024-11-17 |language=en}}</ref>

== Whistleblower program ==
The SEC runs a whistleblower rewards program, which rewards individuals who report violations of [[securities law]]s to the SEC.<ref>{{Cite news|last=Sun|first=Mengqi|date=2020-06-01|title=Tips to SEC Surge as Working From Home Emboldens Whistleblowers|language=en-US|work=[[The Wall Street Journal]]|url=https://www.wsj.com/articles/tips-to-sec-surge-as-working-from-home-emboldens-whistleblowers-11591003800|access-date=2022-01-19|issn=0099-9660}}</ref><ref name="BBC News">{{Cite news|date=2014-09-22|title=Whistleblower in largest-ever award by US government|language=en-GB|work=BBC News|url=https://www.bbc.com/news/business-29316077|access-date=2022-01-19}}</ref> The program began in 2011 with the passage of the [[Dodd–Frank Wall Street Reform and Consumer Protection Act|Dodd-Frank Wall Street Reform and Consumer Protection Act]] and allows whistleblowers to be given 10–30% of the penalties collected by the SEC and other agencies as a result of the whistleblower's information.<ref>{{Cite web|title= Office of the Whistleblower|url=https://www.sec.gov/whistleblower|access-date=2022-01-19|website=SEC.gov}}</ref><ref>{{Cite news|last=Henning|first=Peter J.|date=2016-09-06|title=Whistle-Blowing Insiders: 'Game Changer' for the S.E.C.|language=en-US|work=The New York Times|url=https://www.nytimes.com/2016/09/07/business/dealbook/whistle-blowing-insiders-game-changer-for-the-sec.html |url-access=subscription |access-date=2022-01-19|issn=0362-4331}}</ref><ref>{{Cite web|title=Dodd-Frank SEC Whistleblower Protection Post-Digital Realty|url=https://www.natlawreview.com/article/dodd-frank-sec-whistleblower-protection-post-digital-realty |first1=Jason |last1=Zuckerman |first2=Matthew |last2=Stock |date=November 6, 2020 |access-date=2022-01-19|website=The National Law Review|language=en}}</ref> As of 2021, the SEC had recovered $4.8 billion in monetary remedies as a result of information obtained through the whistleblower program and had paid out over $1 billion to whistleblowers.<ref name="BBC News"/><ref>{{Cite web|title=SEC Hits $1 Billion Milestone|url=https://www.jdsupra.com/legalnews/sec-hits-1-billion-milestone-5622928/ |date=October 14, 2021 |access-date=2022-01-19|website=JD Supra|language=en}}</ref> As part of the program, the SEC issues a report to Congress each year and the 2021 report is available online.<ref>{{Cite web |title=2021 Annual Whistleblower Program Report to Congress |url=https://www.sec.gov/files/owb-2021-annual-report.pdf |url-status=live |archive-url=https://web.archive.org/web/20230612225449/https://www.sec.gov/files/owb-2021-annual-report.pdf |archive-date=Jun 12, 2023 |website=U.S. Securities and Exchange Commission}}</ref>

== Relationship to other agencies ==
In addition to working with various self-regulatory organizations such as the [[Financial Industry Regulatory Authority]] (FINRA), the [[Securities Investor Protection Corporation]] (SIPC), and [[Municipal Securities Rulemaking Board]] (MSRB), the SEC also works with federal agencies, state securities regulators, international securities agencies and law enforcement agencies.<ref name="regulatory">{{cite web |url-status=dead |url=http://www.sia.com/capitol_hill/html/securities_regulation.html |title=Regulatory Structure |website=SIA Primer On Securities |publisher=SIFMA |archive-url=https://web.archive.org/web/20061231110038/http://www.sia.com/capitol_hill/html/securities_regulation.html |archive-date=Dec 31, 2006 }}</ref>

In 1988, [[Working Group on Financial Markets|Executive Order 12631]] established the president's [[Working Group on Financial Markets]]. The Working Group is chaired by the [[United States Secretary of the Treasury|secretary of the treasury]] and includes the chairman of the SEC, the chairman of the [[Federal Reserve System|Federal Reserve]] and the chairman of the [[Commodity Futures Trading Commission]]. The goal of the Working Group is to enhance the integrity, efficiency, orderliness, and competitiveness of the financial markets while maintaining investor confidence.<ref name="treasury">{{cite web |url-status=dead |url=http://www.ustreas.gov/offices/domestic-finance/financial-markets/fin-market-policy/ |website=U.S. Treasury |title=Office of Financial Market Policy |date= March 9, 2010 |archive-url=https://web.archive.org/web/20101203050801/http://www.ustreas.gov/offices/domestic-finance/financial-markets/fin-market-policy/ |archive-date=December 3, 2010 }}</ref>

The Securities Act of 1933 was originally administered by the [[Federal Trade Commission]]. The Securities Exchange Act of 1934 transferred this responsibility from the FTC to the SEC. The Securities Exchange Act of 1934 also gave the SEC the power to regulate the solicitation of proxies, though some of the rules the SEC has since proposed (like the universal proxy) have been controversial.<ref>{{Cite journal|last=Hirst|first=Scott|date=2018-04-01|title=Universal Proxies|url=https://scholarship.law.bu.edu/faculty_scholarship/344|journal=The Harvard Law School Program on Corporate Governance Discussion Paper|volume=2016-11 |via=Scholarly Commons at Boston University School of Law |url-status=live |archive-url=https://web.archive.org/web/20230427123202/https://scholarship.law.bu.edu/faculty_scholarship/344/ |archive-date= Apr 27, 2023 }}</ref>'''{{rp|4}}'''<ref>{{Cite journal|last=Hirst|first=Scott|date=2016-10-01|title=Social Responsibility Resolutions|url=https://scholarship.law.bu.edu/faculty_scholarship/342|journal=The Harvard Law School Program on Corporate Governance Discussion Paper|volume=2016-06 |via=Scholarly Commons at Boston University School of Law |url-status=live |archive-url=https://web.archive.org/web/20230629062536/https://scholarship.law.bu.edu/faculty_scholarship/342/ |archive-date= Jun 29, 2023 }}</ref>'''{{rp|2}}'''  The main mission of the FTC is to promote consumer protection and to eradicate [[anti-competitive practices|anti-competitive business practices]]. The FTC regulates general business practices, while the SEC focuses on the securities markets.

The [[Temporary National Economic Committee]] was established by joint resolution of Congress 52 Stat. 705 on June 16, 1938. It was in charge of reporting to Congress on abuses of monopoly power. The committee was defunded in 1941, but its records are still under seal by order of the SEC.<ref name="tnec">{{cite web|url=https://www.archives.gov/research/guide-fed-records/groups/144.html |title=Records of the Temporary National Economic Committee |publisher=National Archives |access-date=March 1, 2013}}</ref>

The [[Municipal Securities Rulemaking Board]] (MSRB) was established in 1975 by Congress to develop rules for companies involved in [[underwriting]] and trading [[Municipal bond|municipal securities]].  The MSRB is monitored by the SEC, but the MSRB does not have the authority to enforce its rules.

The Asset Management Advisory Committee (AMAC)<ref>{{Cite web|title=Spotlight on Asset Management Advisory Committee (AMAC)|url=https://www.sec.gov/page/asset-management-advisory-committee|access-date=2021-03-25|website=SEC.gov}}</ref> was formally established on 1 November 2019, to provide the SEC with "diverse perspectives on asset management and related advice and recommendations". Topics the committee may address include trends and developments affecting investors and market participants, the effects of globalization, and changes in the role of technology and service providers. The committee is composed of outside experts, including individuals representing the views of retail and institutional investors, small and large funds, intermediaries, and other market participants.<ref>{{Cite web|website=SEC.gov |title= SEC Announces the Formation of Asset Management Advisory Committee|url=https://www.sec.gov/news/press-release/2019-208|access-date=2021-03-25}}{{PD-notice}}</ref>

While most violations of securities laws are enforced by the SEC and the various SROs it monitors, state securities regulators can also enforce statewide securities blue sky laws.<ref name="bluesky"/> States may require securities to be registered in the state before they can be sold there. [[National Securities Markets Improvement Act of 1996]] (NSMIA) addressed this dual system of federal-state regulation by amending Section 18 of the 1933 Act to exempt nationally traded securities from state registration, thereby pre-empting state law in this area.  However, NSMIA preserves the states' anti-fraud authority over all securities traded in the state.<ref name="nsmia">{{cite web|url=http://www.accreditedinvestors.net/national-securities-markets-improvement-act/|title=National Securities Markets Improvement Act|publisher=AccreditedInvestors.net}}</ref>

The SEC also works with federal and state law enforcement agencies to carry out actions against actors alleged to be in violation of the securities laws.

The SEC is a member of [[International Organization of Securities Commissions]] (IOSCO), and uses the IOSCO Multilateral Memorandum of Understanding as well as direct bilateral agreements with other countries' [[securities commission]]s to deal with cross-border misconduct in securities markets.

==Related legislation==
* 1933: [[Securities Act of 1933]]
* 1934: [[Securities Exchange Act of 1934]]
* 1938: [[Temporary National Economic Committee]] (establishment)
* 1939: [[Trust Indenture Act of 1939]]
* 1940: [[Investment Advisers Act of 1940]]
* 1940: [[Investment Company Act of 1940]]
* 1968: [[Williams Act]] (Securities Disclosure Act)
* 1982: [[Garn–St. Germain Depository Institutions Act]]
* 1999: [[Gramm–Leach–Bliley Act]]
* 2000: [[Commodity Futures Modernization Act of 2000]]
* 2002: [[Sarbanes–Oxley Act]]
* 2003: [[Fair and Accurate Credit Transactions Act]] of 2003
* 2006: [[Credit Rating Agency Reform Act]] of 2006
* 2010: [[Dodd–Frank Wall Street Reform and Consumer Protection Act]]
* 2012: [[Volcker Rule]] (a specific section of the Dodd–Frank Act)
* 2020: [[Holding Foreign Companies Accountable Act]]
* [[Title 17 of the Code of Federal Regulations]]
* 2023: SEC Cybersecurity Rules: Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure by Public Companies<ref>{{Cite web|url=https://www.sec.gov/newsroom/press-releases/2023-139|title=SEC.gov &#124; SEC Adopts Rules on Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure by Public Companies|website=www.sec.gov|accessdate=November 6, 2024}}</ref>

==See also==
{{Portal|United States}}
* [[Financial regulation]]
* [[Financial risk management]] 
* [[NYSE Chicago]]
* [[Regulation D (SEC)]]
* [[Regulatory capture]]
* [[Risk management]]
* [[Securities market participants (United States)]]
* [[United States securities regulation]]
* [[List of financial regulatory authorities by jurisdiction]]

=== Forms ===
* [[SEC filing]]
** [[Form 4]] (stock and stock options ownership and exercise disclosure)
** [[Form 8-K]]
** [[Form 10-K]]
** [[Form 10-Q]]
** [[Form S-1]] ([[Initial public offering|IPO]])

== References ==
{{reflist}}

== External links ==
{{commons category|United States Securities and Exchange Commission}}
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{{SEC}}
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