Financial Regulation: An Overview

2. Commodities Futures Trading Commission: The CFTC has its roots in the Commodity Exchange Act of 1936. The CFTC is responsible for the regulation of commodity, futures and options on futures. (Options on stocks and stock indexes fall under the jurisdiction of SEC.) Products traded on the Chicago Mercantile Exchange or Nymex, both owned by the CME, are regulated by the CFTC. The CFTC is currently headed by Chairman Gary Gensler, a former Goldman Sachs(GS Quote) partner.

3. Federal Reserve System: The Fed, as it is commonly known, is the central bank for the U.S. Part of its responsibilities is to conduct monetary policy for the country. This function is handled by the Federal Open Market Committee. The Fed also acts as a depository institution for banks. Furthermore, the Fed is responsible for supervising and regulating the banking and financial system. Lastly, through a series of regulations, the Fed oversees rules for the extension of credit by banks and broker dealers. The most important of these rules for investors is Regulation T, which sets forth the rules for the extension of credit to investors. The Fed is headed by Chairman Ben Bernanke.

4. Federal Deposit Insurance Corporation: This agency is responsible for insuring bank deposits, for managing failed banks that have been put into receivership and for bank examinations. While it may appear that the FDIC has many similar responsibilities to that of the Fed, the two remain independent of one another. The FDIC is headed by Sheila Bair, another former chair of the CFTC.

5. U.S. Treasury: The U.S. Treasury is one of the oldest institutions in the Federal government, having been provided by an act of Congress on Sept. 2, 1789. The Treasury is responsible for public debt, currency issuance and control, Federal budgeting, the Internal Revenue Service and the Secret Service. Secretary of the Treasury Timothy Geithner is the fifth in line to succeed the president in the event of a vacancy in that office.