Browse SIE Series

Mastering FINRA, MSRB, and SEC Rules for Exam Success

Exploring key FINRA, MSRB, and SEC rules, with guidance for accessing official texts to ensure you ace the SIE Exam.

Understanding Relevant Rules and Regulations in the Securities Industry§

Passing the SIE exam requires a thorough grasp of the rules and regulations that govern the securities industry. This article breaks down complex rules from FINRA, MSRB, and the SEC, providing accessible explanations, real-world examples, and guidance on where to find official regulatory texts.

FINRA Rules§

Definition: FINRA (Financial Industry Regulatory Authority) enforces rules designed to protect investors and ensure market integrity. Key rules include those governing conduct, compliance, and immediate supervision of representatives.

Example:§

Consider a scenario where a representative fails to disclose a conflict of interest. FINRA Rule 3220 mandates disclosure to maintain transparency with clients.

Visual Aid:§

Summary Points:§

  • FINRA enforces rules to protect investors.
  • Representatives must disclose conflicts of interest.

MSRB Rules§

Definition: The Municipal Securities Rulemaking Board (MSRB) creates regulations for firms and individuals transacting in the municipal securities market.

Example:§

MSRB Rule G-17 requires fair dealing in municipal securities transactions, prohibiting deceptive practices.

Summary Points:§

  • MSRB focuses on municipal securities.
  • Fair dealing and transparency are key principles.

SEC Rules§

Definition: The Securities and Exchange Commission (SEC) oversees the securities markets, enforcing rules to ensure fair and efficient markets.

Example:§

A company considering going public must adhere to SEC Rule 144 for selling restricted securities.

Visual Aid:§

    graph TD;
	    X[Company] --> Y[Public Listing]
	    Y --> Z{Rule 144 Compliance}
	    Z -->|Compliant| A[Legal Sale]
	    Z -->|Non-compliant| B[Legal Consequences]

Summary Points:§

  • The SEC ensures market fairness and transparency.
  • Compliance with rules like Rule 144 is essential for legal transactions.

Where to Find Official Texts§

  1. FINRA: Visit FINRA.org for comprehensive rules and publications.
  2. MSRB: Access MSRB.org for municipal securities regulations.
  3. SEC: The SEC’s official website offers detailed regulations and resources.

Additional Resources:§

Glossary§

  • **FINRA**: Financial Industry Regulatory Authority
  • **MSRB**: Municipal Securities Rulemaking Board
  • **SEC**: Securities and Exchange Commission


Tuesday, October 1, 2024