Securities and Exchange Commission (SEC)

Brief Definition

The Securities and Exchange Commission (SEC) is a U.S. government agency responsible for regulating the securities markets and protecting investors.

Further Explanation

The Securities and Exchange Commission (SEC) is a U.S. government agency responsible for regulating the securities markets and protecting investors. Its primary functions include enforcing securities laws, overseeing securities exchanges, brokers, and dealers, and ensuring that public companies disclose important financial information. The SEC aims to maintain fair, orderly, and efficient markets and facilitate capital formation.

Example:
When a company wants to go public and sell shares to investors, it must file a registration statement with the SEC, providing detailed financial information. The SEC reviews this information to ensure it is complete and accurate, protecting potential investors from fraud.