Exploring key FINRA, MSRB, and SEC rules, with guidance for accessing official texts to ensure you ace the SIE Exam.
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.
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.
Consider a scenario where a representative fails to disclose a conflict of interest. FINRA Rule 3220 mandates disclosure to maintain transparency with clients.
Definition: The Municipal Securities Rulemaking Board (MSRB) creates regulations for firms and individuals transacting in the municipal securities market.
MSRB Rule G-17 requires fair dealing in municipal securities transactions, prohibiting deceptive practices.
Definition: The Securities and Exchange Commission (SEC) oversees the securities markets, enforcing rules to ensure fair and efficient markets.
A company considering going public must adhere to SEC Rule 144 for selling restricted securities.
graph TD; X[Company] --> Y[Public Listing] Y --> Z{Rule 144 Compliance} Z -->|Compliant| A[Legal Sale] Z -->|Non-compliant| B[Legal Consequences]