Who is primarily responsible for making sure that securities firms comply with regulatory requirements?

The firms themselves hold the primary responsibility for ensuring compliance with regulatory requirements. This includes adhering to rules set forth by regulatory bodies, implementing internal controls, and training employees to understand their compliance obligations. Each securities firm is expected to have structures in place to manage risks, maintain accurate records, and protect customer interests, thus establishing a culture of compliance within the organization.

While state regulators, the SEC, and self-regulatory organizations (SROs) play important roles in the regulatory landscape, they primarily oversee and enforce compliance rather than executing it directly. The SEC monitors the overall functioning of the securities markets and enforces federal securities laws, while state regulators focus on issues pertinent to specific states. SROs, such as the FINRA, create rules and practices for firms and enforce compliance among their members but do so in a supportive and oversight capacity. Ultimately, the onus of compliance rests with the individual firms that must navigate these requirements effectively.