Regulatory Licensing

DISA’s financial due diligence services include a comprehensive search of both federal and state-level regulators and self-regulatory organizations to help clients mitigate risks associated with securities investments and those governed by such regulations. Violations can lead to censures, sanctions, monetary fines, restitution, and criminal liability for non-compliance with securities regulations.

A self-regulatory organization (SRO) that regulates member brokerage firms, exchange markets, and the New York Stock Exchange. FINRA regulates trading in equities, corporate bonds, securities futures, and options. All firms dealing in securities that are not regulated by another SRO are required to be member firms. FINRA operates the largest arbitration forum in the United States to resolve disputes between customers and member firms, as well as between the brokerage employees and their firms. FINRA is the successor to the National Association of Securities Dealers, Inc. (NASD).

An independent agency of the U.S. government, whose purpose is to enforce laws against market manipulation, protect investors, facilitate capital formation, and maintain fair, orderly, and efficient markets. This is implemented through enforcement actions against securities violators. The SEC also requires all public companies and other regulated companies to submit periodic reports, which are maintained in the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) database.

A self-regulatory organization (SRO) for the U.S. derivatives industry, including on-exchange traded futures, retail off-exchange foreign currency (forex), and OTC derivatives (swaps). The NFA has been designated as a safeguard for the integrity of the derivatives markets, protecting investors, and ensuring that members fulfill their regulatory obligations by the Commodity Futures Trading Commission (CFTC). NFA membership is mandatory for many Futures market participants. The NFA maintains a database of disciplinary actions against its members, as well as CFTC violations and other exchange-related enforcement actions.

A global, non-profit professional organization that provides financial education to investment professionals and bestows the designation of Chartered Financial Analyst, a program consisting of examinations testing the fundamentals of investment tools, valuing assets, portfolio management, and wealth planning. The CFA charter is considered to be the gold standard for the investment industry. The institute maintains a database of disciplinary sanctions for violations of the Code of Ethics and Standards of Professional Conduct and those who have permanently resigned while under investigation for industry-related misconduct. The CFA Institute was formerly the Association for Investment Management and Research.

Each U.S. state maintains a department dedicated to the regulation of the securities industry within its borders. All state securities regulators also contribute to the Central Registration Depository (CRD), the central database containing records for all firms and individuals registered in the U.S. securities industry.