More On Legal & Compliancefrom The Advisor's Professional Library
Rep. Spencer Bachus, R-Ala., chairman of the House Financial Services Committee, released an oversight plan in January which includes issues his committee will tackle in the 112th Congress. Besides holding oversight hearings on specific Dodd-Frank-related areas like the Volcker Rule, the Financial Stability Oversight Council, and the Office of Financial Research, as well as on derivatives and credit ratings agencies, Bachus and his subcommittees will also hold hearings on these issues:
• Oversight and Restructuring of the Securities and Exchange Commission (SEC). The Committee plans to monitor “all significant aspects of the SEC’s operations to ensure that it fulfills its Congressional mandate.” The Committee will examine the SEC’s budget requests to ensure that the agency deploys its resources effectively and plans to examine the operations and organizational structure of the SEC, placing an emphasis on its supervisory and inspection functions. The Committee will also consider the impact of separating the SEC’s examination and policy functions and whether such functions should be consolidated.
• Regulation and Oversight of Broker-Dealers and Investment Advisors. The Committee will examine the study mandated by Section 913 of the Dodd-Frank Act, which requires the SEC to review the effectiveness of the legal and regulatory standards of care applicable to broker-dealers and investment advisors when providing personalized investment advice to retail customers. The Committee will also examine the study mandated by Section 914 of the Dodd-Frank Act, which requires the SEC to report on the need for enhanced examination and enforcement resources for investment advisors, and on whether self-regulatory organizations (SROs) or user fees should be used to augment SEC and state oversight of RIAs.
• Securities Fraud. The Committee intends to review the SEC‘s compliance, inspections, examinations and enforcement functions to ensure that adequate mechanisms exist to prevent and detect securities fraud. The Committee will also monitor the SEC‘s implementation and adherence to the reforms recommended by the SEC‘s Office of Inspector General resulting from the Commission’s failure to detect either the Bernie Madoff or Allen Stanford Ponzi schemes.
• Mutual Funds. The Committee will examine the state and operation of the U.S. mutual fund industry. This examination will include reviewing the SEC’s regulation of money market mutual funds, and any proposed changes to the calculation of money market funds’ net asset value (NAV). The Committee will also review any proposals by the Financial Stability Oversight Council (FSOC) to designate non-bank financial institutions such as mutual funds as Systemically Important Financial Institutions.