Securities and Exchange Commission Should Strengthen Its Inspection Oversight of the National Association of Securities Dealers

By legislation, the Congress delegated certain regulatory functions in the securities markets to the industry's self-regulatory organizations, subject to the oversight of the Securities and Exchange Commission (SEC). The National Association of Securities Dealers acts as the self-regulator of member securities firms and persons who trade in securities not sold on the stock exchanges. About 18,000 firms are members of the Association.