Financial Regulators – Who They Are and What They Do

A system of checks and balances helps keep the stability of our financial markets. In charge of the system are various regulating bodies, known as financial regulators. 

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What is the Primary Purpose of Regulatory Agencies? 

Financial regulatory agencies are government agencies or independent organizations responsible for enforcing laws and regulations, overseeing market activities, and protecting consumers and investors. 

There are several regulatory agencies that oversee the activities of banks, credit unions, and savings & loan associations. Various regulators oversee the mortgage industry, the insurance industry, and the stock markets. 

By overseeing and regulating financial markets and institutions, these financial regulators serve to uphold the integrity of the financial markets, ensuring stability, transparency, and fairness. 

Who are financial regulators? 

Many financial regulatory agencies exist in the world. In the US, notable securities regulators include the Securities and Exchange Commission (SEC), which has six divisions and 24 offices, and the Commodity Futures Trading Commission (CFTC). 

Other financial regulators that review the banking industry include the Federal Reserve System (“the Fed”), Federal Deposit Insurance Corporation (FDIC), and Consumer Financial Protection Bureau (CFPB) for the protection of consumers. 

Abroad, the Financial Conduct Authority oversees the UK markets. The European Central Bank has power over financial regulation in the European Union. Countries like Japan, South Korea, and India also have similar agencies to help oversee their markets. 

Key Responsibilities 

Financial regulators are in charge of overseeing financial markets to help keep them fair and stable. Financial regulators create or uphold regulations to help prevent and investigate fraud, maintain market efficiency and transparency, and ensure customers and clients are treated fairly and honestly. 

Main responsibilities may vary, depending on the types of financial markets and institutions they oversee in their jurisdiction. Here are key aspects of financial regulatory work: 

  • Monitor financial markets and institutions to detect and prevent fraudulent or illegal activity. 
  • Enforce laws and regulations related to financial services and products. 
  • Conduct investigations and bring legal actions against violators. 
  • Promote transparency and accountability in financial markets. 
  • Protect consumers and investors from fraud, misconduct, and abuse. 
  • Promote financial stability and manage risk. 

Becoming a Financial Regulator 

There are various reasons why you would want to become a financial regulator. You may have a passion for finance and economics or a true yearning to grow a career in the financial industry. Having a career in financial regulation can be intellectually challenging and financially rewarding. 

Working as a Financial Regulator 

A good education, training, and professional experience can help you become a financial regulator. Typically, some people start their careers as analysts or examiners. Later, they can get promoted to better positions. Other more experienced professionals may join as senior managers or executives. 

Today’s modern financial regulators usually have advanced degrees in finance, economics, law, or related fields. They may have already worked in financial services before leveraging their experience into a regulatory role. 

Ongoing professional development, such as continuing education and certifications, is often necessary to keep up with changes in the industry and regulatory landscape. Our Professional Development eLearning series helps to advance careers, so your organization can achieve even greater success.

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By |2023-06-23T08:42:14-06:00June 23rd, 2023|Bank, Credit Union, Financial, Financial Services, Mortgage|Comments Off on Financial Regulators – Who They Are and What They Do