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Compliance August 31, 2011
Hearing on Regulation of B/Ds and RIAs Set
The question of how broker/dealers (B/Ds) and registered investment advisers (RIAs) should be regulated will be discussed at a hearing on September 13 by a House of Representatives subcommittee.
Reported by Nicole Bliman
The Capital Markets and Government Sponsored Enterprises Subcommittee (part of the Committee on Financial Services) will hold a hearing about the regulation and oversight of B/Ds and investment advisers on Tuesday, September 13. The Subcommittee will examine studies mandated by the Dodd-Frank Act about the effectiveness of standards of care applicable to B/Ds and RIAs, and the need for enhanced examination and enforcement resources.
At the center of the debate will be the question of “who” – who should be responsible for regulating investment advisers; should the Securities and Exchange Commission (SEC) continue to bear the responsibility, even though its resources are stretched, or should the baton be passed to a self-regulatory organization, such as the Financial Industry Regulatory Authority (FINRA), which has voiced its ambition for the role (see “SEC Publishes Report about RIA Oversight”).
The House Capital Markets Subcommittee Chairman Rep. Scott Garrett, (R, N.J.) recently introduced the SEC Regulatory Accountability Act (H.R. 2308), which would require the SEC to conduct enhanced cost-benefit analyses on its rules.
On Thursday, September 15, the full Financial Services Committee will hold a hearing about the structure and operations of the Securities and Exchange Commission and the need for reform of the SEC.