Update 103
Although the SEC is the primary securities market regulator, states’ securities regulation — not the SEC, not FINRA — is where the action is. States take the lead in enforcement actions in all the states.
Remember the Global Settlement mutual fund scandal? An assortment of sleazy practices were long-standing “open secrets” known to almost everyone on Wall Street but totally unknown to Main Street investors. State regulators were the ones to take on these well-known injurious industry practices.
Not only are state regulators the most alert cops on the beat, their proximity to investors can help a wronged investor more expeditiously than is case with the SEC. Finally, state regulators often have a mandate to protect investors that extends beyond SEC enforcement; many states proactively educate investors to help them identify signs of wrongdoing.
