Which US government agency regulates investment banks?

Which US government agency regulates investment banks? The Securities and Exchange Commission (SEC) regulates their securities-market activities.

Created by Congress in 1934 after the 1929 stock-market crash, the SEC enforces federal securities laws and oversees markets, exchanges, broker-dealers, and investment advisers. Investment banks commonly operate through broker-dealer subsidiaries, which must register with the SEC and follow rules on trading, disclosure, capital, record-keeping, and customer protection.

The answer is sometimes simplified: the SEC is not the only regulator connected to a large financial institution. The Federal Reserve supervises bank holding companies and financial holding companies, while FINRA oversees many broker-dealers as a self-regulatory organization under SEC oversight. The FDIC insures eligible deposits and resolves failed banks; it is not the primary securities regulator.

Thus, the SEC is the canonical quiz answer when the question asks which federal agency regulates investment-bank securities activities.