Financial Industry Regulatory Authority (FINRA)

The SEC and FINRA both regulate U.S. financial markets, but they have different jobs. The SEC is a government agency that enforces federal securities laws and oversees public companies, investment advisers, and stock exchanges. It sets the main rules and investigates serious violations like insider trading or fraud. FINRA focuses on broker-dealers, the firms and individuals who buy and sell securities for clients. It creates and enforces rules for these groups, checks trading activity, audits firms, and educates investors. In short, the SEC sets the laws, while FINRA makes sure broker-dealers follow the rules.

To get FINRA certified, you must be employed or sponsored by a firm that is a FINRA member. You cannot take FINRA exams on your own unless you are connected to a registered broker-dealer. Once you have sponsorship, you need to pass one or more licensing exams based on your job. Most people start with the Securities Industry Essentials (SIE) exam, which covers basic industry knowledge. After that, you usually take a "top-off" exam like the Series 7 or Series 63/66, depending on your role. The exams are given by Prometric and are known to be challenging. Certification also requires ongoing education, following ethical rules, and regular disclosures to stay current in the industry.

A FINRA license is permission for someone to work in certain areas of the securities industry after passing exams run by FINRA. Each license matches a specific job. For example, the Series 6 lets someone sell mutual funds and variable annuities, while the Series 24 allows them to supervise other representatives. Having a FINRA license shows that a financial professional meets industry standards and knows the rules for selling securities and giving advice. These licenses must be kept up to date, and breaking the rules can lead to suspension or losing the license for good.