Securities regulators are warning that some brokerages have "material weaknesses" in risk management procedures. Some firms had poor supervisory structures or used inappropriate risk measurement tools, the agencies said. They found that others did a good job of defining authorized activities and their limits, and employed experienced, and often independent, risk-management personnel.
The warning came in a statement by the Securities and Exchange Commission, the New York Stock Exchange, and the regulatory arm of the National Association of Securities Dealers. They formed a task force several years ago in the wake of huge losses involving securities trading.