What is the SEC?
The SEC is the primary federal regulator of US securities markets, overseeing exchanges, brokers, investment advisers, and public companies, and enforcing laws against insider trading and fraud.
The Securities and Exchange Commission (SEC) is the independent federal agency responsible for overseeing and regulating the US securities industry. Created by the Securities Exchange Act of 1934 in response to the 1929 stock market crash, its mandate is to protect investors, maintain fair and efficient markets, and facilitate capital formation.
The SEC's authority covers a broad range of market participants: public companies must register securities and file ongoing disclosures; broker-dealers must register and comply with conduct standards; investment advisers managing significant assets register with the SEC; mutual funds and ETFs are regulated under the Investment Company Act of 1940.
For public companies, the SEC's disclosure regime is central to how US markets function. Every company listed on a US exchange must file Form 10-K (annual report), Form 10-Q (quarterly report), Form 8-K (current report for material events), and proxy statements (DEF 14A) with the SEC's EDGAR database. These filings are publicly available, giving all investors simultaneous access to material financial information.
The SEC also enforces the rules against insider trading — trading on material, non-public information — and securities fraud, through both civil enforcement actions (fines, disgorgement of profits, trading bans) and criminal referrals to the Department of Justice for the most egregious cases.
SEC rulemaking shapes the structure of US markets in deep ways. Rules on Regulation FD (fair disclosure), Regulation NMS (national market structure), and rules governing high-frequency trading, dark pools, and short selling all originate from SEC proposals and are heavily debated by the industry before adoption.