Forty states are currently part of the system, and others will join as soon as their computer software can be adapted to the NEMO software.
The examiners in each state, who look at the broker-dealer firms and advisory firms, look at how a firm operates, whether it is complying with the regulations for selling the products it sells, how its records are kept, and the appropriateness of the products it offers, among many other things.
Some information cannot be shared between states because of the individual states’ confidentiality law, Huggs says.