sec

The SEC is a federal government agency that is led by five commissioners who are appointed by the President to serve staggered five-year terms. The persons holding these offices must be approved by the Senate, and in an effort to promote bi-partisan agreement, no more than three may be of the same political party. The commissioners are supported by a staff of more than 3,500 who work from 11 regional and district offices spread throughout the nation.

The SEC is organized into five distinct divisions:

Division of Corporate Finance: This division ensures that all publicly traded corporations fully disclose their financial results. Companies planning to issue securities for the first time must file registration statements, and those whose shares are already listed must submit quarterly updates (10-Q), as well as year-end filings (10-K). Public companies also must send out their annual reports to shareholders.

The corporate finance division protects the interests of investors by requiring companies to fully disclose all relevant financial information -- both positive and negative -- in a timely manner, thereby giving the public the data it needs to make prudent decisions on buying and selling.

Division of Trading and Markets: This division keeps the markets running on a fair and orderly basis by monitoring and regulating the activities of those who are actively involved in the process of buying and selling stocks or bonds, including broker/dealers, clearing agents and transfer agents. The division also keeps tabs on the Securities Investor Protection Corporation (SIPC), which safeguards investors' assets against losses arising from the bankruptcy of brokerage firms.

Division of Investment Management: This division oversees the investment management industry, which includes mutual funds and fund managers, analysts and investment advisors. The division responds to certain complaints about this industry, helps create and interpret laws governing the industry and reviews filings from members of the industry.

Division of Enforcement: This division recommends investigations, civil actions, administrative proceedings and prosecutions on behalf of the SEC. Because the SEC has the authority only to enforce civil penalties, it works with the U.S. Department of Justice to bring criminal actions in certain cases. This division also obtains the evidence used in these proceedings.

Division of Risk, Strategy and Financial Innovation: This division, established in September 2009, conducts analyses of hedge funds, derivatives markets and other markets to identify trends that might threaten the systemic risk in the U.S. economy. The division then recommends further research or other actions to mitigate these risks where appropriate.