Click here to read our post about the history and mission of the SEC.

The SEC breaks down its responsibilities into five major categories on its website:

  • “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 the inspection of securities firms, brokers, investment advisers, and ratings agencies;”
  • “Oversee private regulatory organizations in the securities, accounting, and auditing fields:”
  • “Coordinate U.S. securities regulations with federal, state, and foreign authorities”

According to Investopedia, the SEC is involved in major cases, usually involving accounting fraud and spreading misleading or false information. The agency usually works with the Justice Department when bringing civil enforcement actions against firms and brokers who violate securities laws.

Penalties from the SEC can be severe, depending on how serious the allegations are against a firm or broker. After the 2008 recession, the agency charged 204 entities or individuals with penalties reports Investopedia. The financial site notes the SEC collected close to $4 billion in penalties and other monetary relief after the recession. Goldman Sachs paid $550 million to the SEC following the 2008 recession, the most any Wall Street firm has paid for a penalty to the SEC. WorldCom paid $750 million to the SEC to settle an accounting fraud lawsuit in 2003 according to the New York Times. It’s the highest penalty ever paid to the SEC.

This is a small sample of what the SEC does and how the agency regulates the securities industry. Spencer Law Firm will continue to cover the SEC and explain how the agency functions in future posts, so be sure to check back often.

The Spencer Law Firm’s attorneys litigate securities related proceedings such as FINRA arbitration and enforcement actions.  If you have any questions regarding FINRA or if you have a FINRA arbitration or enforcement action and need assistance, please feel free to call Bonnie Spencer at the Spencer Law Firm at (888)237-459 to see what we can do for you. You can also visit us at or at our office at 4635 Southwest Freeway, Suite 900, Houston, Texas, 77027.