SEC Seeks Public Comments, 'Greater Transparency' on New Financial Regulations

Wall Street on Notice

In her speech, "Moving Forward: The Next Phase in Financial Regulatory Reform," the Schapiro put Wall Street on notice that the "regulatory process is not designed to re-debate issues that Congress has resolved." The Commission, she said, typically "seeks public comments on its proposed rules. But, because of the significant rulemaking envisioned under the Act, we are expanding our process beyond what is legally required."

Listening to Investors

Schapiro noted in the speech that that the SEC is hearing from–and listening to–investors large and small. These investors are concerned "about the about the confusing nature of their relationship with financial advisers," and the "disadvantage" they are at "relative handful of sophisticated traders and market intermediaries with unfair access and built-in advantages."

And, Schapiro added, "we also hear how investors are harmed by opacity and excessive complexity in over-the-counter derivatives and structured products, subjected to hidden costs or to risks that were not clearly and fully explained."

Schapiro said the goal "is to offer maximum opportunity for public comment and to provide greater transparency. We are inviting public comment even before the various rules are proposed and before the official comment periods have begun."

So the Commission is inviting comment and acknowledging that, "investors, leaders of small and large businesses, academics and others who identify issues, and who offer ideas and alternatives, can help us create a regulatory structure that supports our shared goals over the long term."

Comments? Please send them to [email protected]. Kate McBride is editor in chief of Wealth Manager and a member of The Committee for the Fiduciary Standard.