Basics

The Financial Services industry’s maze of regulations and laws often leaves many confused. While the securities industry, relative to the banking industry, has fewer laws, these laws have been around for a significant period of modern American history, changing little until the 21st century. An additional difference from banking regulations is that securities regulations focus primarily on disclosures and transparency, whereas banking regulations are primarily prudential and supervisory. In recent years, especially with the rise of Financial Holding Companies, many federal and state laws have regulated firms offering banking, payments, and securities services as financial firms adapted to provide full-service financial products to clients. While U.S. capital markets continue to innovate and thrive, the regulatory landscape will need to adapt to the changing nature of the U.S. economy and the needs of investors.