Two self-regulatory organizations for the securities industry announced an agreement with 10 U.S. exchanges to consolidate the enforcement of insider-trading laws.
The agreement, which has been filed with the Securities and Exchange Commission, is between NYSE Regulation Inc. and the Financial Industry Regulatory Authority. Participating market centers include the NYSE, the American Stock Exchange and the Chicago Stock Exchange. The deal will consolidate within NYSE Regulation and Finra what used to be 11 separate programs at each market center, said Finra Senior Executive Vice President Stephen Luparello.
Under the agreement, NYSE Regulation will have responsibility for insider-trading detection at the New York Stock Exchange and NYSE Arca-listed securities, while Finra will oversee the detection for Amex- and NASDAQ-listed securities, no matter where trading occurs in the U.S. Finra was created from a merger of the National Association of Securities Dealers and regulatory functions of the NYSE.
Currently each exchange conducts its own regulation of insider trading and relies on cooperation with other exchanges when suspicious trading is detected.
