On July 30, in an historic move, NASD and NYSE Member Regulation consolidated into a single regulatory organization for the securities industry.  The newly formed organization, called the Financial Industry Regulatory Authority, Inc. (“FINRA”), is now the largest non-governmental regulator for all securities firms doing business in the United States. 

Operating under SEC supervision, FINRA conducts regulatory oversight of more than 5,000 securities firms and 666,000 registered representatives.  It is responsible for rule writing, firm examination, enforcement, and arbitration and mediation functions, along with all functions that were previously overseen solely by the NASD (including market regulation under contract for NASDAQ), the American Stock Exchange, the International Securities Exchange and the Chicago Climate Exchange.  In addition, FINRA is responsible for operating industry utilities, such as trade reporting facilities and other over-the-counter operations.  The consolidation of functions into FINRA is intended to streamline the broker-dealer regulatory system, reduce the financial burdens placed on member firms as a result of duplicate self-regulatory structure, and permit the establishment of a single set of rules governing membership matters, with the aim of enhancing oversight of U.S. securities firms and enhancing investor protection. 

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