SEC vs NASAA: Jurisdiction and Focus Explained
- April 1, 2025
- Posted by: 'FINRA Exam Mastery'
- Category: Finance
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⚖️ SEC vs NASAA: Jurisdiction and Focus Explained
When preparing for FINRA exams like Series 63, 65, or 66, it’s essential to understand the difference between the Securities and Exchange Commission (SEC) and the North American Securities Administrators Association (NASAA). Both play vital roles in U.S. securities regulation — but their jurisdictions, responsibilities, and exam focus areas are very different.
This breakdown will help you distinguish between the two and answer exam questions with confidence.
🏛️ What Is the SEC?
SEC – Securities and Exchange Commission
- Federal regulatory agency established by the Securities Exchange Act of 1934
- Oversees national securities markets and public companies
📌 SEC Jurisdiction:
- Broker-dealers (BDs)
- Investment advisers (with >$100M AUM)
- Securities exchanges (NYSE, NASDAQ)
- Mutual funds and ETFs
- Insider trading, fraud, and enforcement
🎯 SEC Focus Areas on Exams:
- Regulation of securities offerings (e.g., 1933 Act)
- Anti-fraud provisions (Rule 10b-5)
- Registration of investment advisers at the federal level
- Oversight of disclosures and compliance reporting
- Enforcement of national securities laws
🌐 What Is NASAA?
NASAA – North American Securities Administrators Association
- Organization of state securities regulators from all 50 U.S. states, DC, Canada, and Mexico
- Not a regulatory agency, but it creates model rules and uniform laws
📌 NASAA Jurisdiction:
- State-registered investment advisers (under $100M AUM)
- Broker-dealer agents and IARs at the state level
- State securities registration and exemptions
- Investigation of state-level fraud and unethical practices
🎯 NASAA Focus Areas on Exams:
- Uniform Securities Act (USA)
- State registration vs. exemption rules
- Fiduciary responsibility of IARs
- Administrator authority (cease and desist, summary orders)
- Rules around offers, sales, and advertising at the state level
🧠 SEC vs NASAA – Key Differences
| Category | SEC (Federal) | NASAA (State) |
|---|---|---|
| 📍 Jurisdiction | National | State-level |
| 🧑 Regulates | Public companies, BDs, large RIAs | Agents, IARs, small RIAs |
| 📝 Exam Focus | Federal securities laws | Uniform Securities Act, NASAA model rules |
| ⚖️ Enforcement | Insider trading, market fraud | State-level fraud, unethical sales practices |
| 📄 Key Forms | ADV, 10-K, 10-Q, Form BD | Form U4, U5, state filings |
| 🛠️ Tools | SEC Rule 10b-5, Reg D, 1940 Act | Model Rules for Advisers and Broker-Dealers |
🧭 How This Appears on Exams
- Series 63/66: Focus on state authority and NASAA regulations
- Series 65: Mix of federal and state, especially adviser registration and exemptions
- Watch for questions asking who has jurisdiction or what registration is required
🎓 Want more exam-ready comparisons like this?
Get downloadable charts, full breakdowns, and rule-based practice questions at finra-exam-mastery.com – Study smarter, pass faster.