Which statement is true regarding MSRB enforcement for broker-dealers?

• A. Enforcement is performed by the MSRB
• B. Enforcement is performed by the Securities and Exchange Commission and FINRA
• C. Enforcement is performed by the Office of the Comptroller of Currency
• D. Enforcement is performed by the Federal Reserve Board

Answer: (B)

Enforcement authority for MSRB rules rests with the Securities and Exchange Commission and FINRA. The MSRB creates the rules for broker-dealers and municipal securities, but it does not enforce them itself. Instead, the SEC brings actions for MSRB violations and works in tandem with FINRA, the primary self-regulatory organization overseeing broker-dealers, to enforce those rules. Agencies that regulate banks, such as the Office of the Comptroller of the Currency and the Federal Reserve Board, do not enforce MSRB rules for broker-dealers.