HopefullyInLawSchool
16:06
Warning
Info
Warning
Info
LSDefine
Simple English definitions for legal terms
Self regulatory organization
Read a random definition: topographical survey
A quick definition of Self regulatory organization:
A self regulatory organization (SRO) is a group that helps make sure people follow the rules when they buy and sell stocks. The government sets the goals and rules for the SRO, but the SRO is in charge of making sure its members follow those rules. The SRO can punish members who break the rules. Broker-dealers, who help people buy and sell stocks, also have to follow SRO rules. The biggest SRO is called FINRA, and it helps protect investors and make sure broker-dealers are doing their job right.A more thorough explanation:
A Self Regulatory Organization (SRO) is a group that regulates its own industry under the watchful eye of the Securities and Exchange Commission (SEC). The SEC sets the standards and objectives for the SRO's rules, which must prevent fraud and market manipulation, promote fair trade, and provide disciplinary actions against members who violate federal securities law. SROs also address fee structures for brokers.
For example, the New York Stock Exchange (NYSE) and the Financial Industry Regulatory Authority (FINRA) are both SROs. The NYSE has rules that apply to any market participant who trades on that stock exchange, while FINRA provides a single forum where investors can seek arbitration for claims that they have against broker-dealer firms and the firms’ employees.
The SEC has the power to ensure that the SROs fulfill their regulatory responsibilities on an ongoing basis. If an SRO violates rules of good practice and fails to police and discipline their members, the SEC can take enforcement actions against them. However, the SEC rarely reverses SRO’s disciplinary actions.
Self determination (international law) | Self-Authenticating Documents