The Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are the primary regulatory agencies in the United States responsible for overseeing the securities and derivatives markets, respectively. A core function of both agencies is the prevention, detection, and prosecution of deceptive practices that undermine market integrity and investor confidence. This includes activities such as insider trading, market manipulation, Ponzi schemes, and misrepresentation of financial information.
Upholding market integrity through diligent enforcement benefits the overall economy by ensuring fair competition, fostering investor trust, and allocating capital efficiently. The SEC and CFTC safeguard investors, promote market efficiency, and prevent systemic risk. Historically, instances of unchecked fraudulent activity have led to financial crises and widespread economic hardship, underscoring the critical role these agencies play in maintaining stable and reliable markets. The historical context illustrates the necessity of proactive and reactive measures to combat financial misconduct.
