News Release

FINRA Alerts Investors of U.S. Treasury Program to Guarantee Money Market Funds that "Break the Buck"

Washington, DC — The Financial Industry Regulatory Authority (FINRA) today issued an Investor Alert to notify the investing public of the U.S. Treasury Department's Temporary Guarantee Program for Money Market Funds. The Treasury Department's program, which opened Sept. 29, protects money held in participating money market funds as of Sept. 19 if those money market funds "break the buck." A money market fund breaks the buck when its net asset value (NAV) falls below $1.00 per share.

"FINRA is committed to keeping the public informed about the many safeguards in place concerning their investments because an informed investor is a better protected investor," said John Gannon, FINRA Senior Vice President for Investor Education. "Money market funds are lower-risk investments, but investors should know that there is some risk, and now there is also an important program in place to lessen that risk."

Investors cannot sign up for the guarantee program on their own. Instead, each money market fund must decide whether to participate and must apply by Oct. 8, 2008, to join the program. Investors can find out whether a money market fund participates in the program by contacting the fund directly.

FINRA's Investor Alert Treasury's Guarantee Program for Money Market Mutual Funds: What You Should Know explains that:

  • The insurance provided by the program only covers the total value of a shareholder's account in a participating fund as of the close of business on Sept. 19, 2008.
  • Participation in the program by a tax-exempt money market fund will not jeopardize the tax-exempt status of payments.
  • The program will be in effect for three months, beginning Sept. 19, 2008. After three months, the Secretary of the Treasury will assess the program and decide whether to extend it. The program can be extended until Sept. 18, 2009.

FINRA's Investor Alert also outlines in straightforward language the basics of money market funds, explains the meaning of the phrase "break the buck" and tells investors where they can turn for help.

FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for all securities firms doing business in the United States. Created in 2007 through the consolidation of NASD and NYSE Member Regulation, FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business-from registering and educating all industry participants to examining securities firms; writing and enforcing rules and the federal securities laws; informing and educating the investing public; providing trade reporting and other industry utilities; and administering the largest dispute resolution forum for investors and registered firms. For more information, please visit our Web site at