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SEC to Public: Have Any Ideas About How to Educate Investors?

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The U.S. Securities and Exchange Commission (SEC) is asking the public for ideas about which approaches to investor education are – and are not – working.

The SEC is posting the investor education request for comments in response to Section 917 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Dodd-Frank Act Section 917 requires the SEC to conduct a study of the effectiveness Piggy bankof existing investor education efforts and report to Congress on its findings by July 21, 2012.

In the report, the SEC is supposed to discuss:

  • Retail investors’ current level of financial literacy.
  • Methods for improving disclosures regarding financial intermediaries, investment products and investment services.
  • Methods for increasing the transparency of expenses and conflicts of interest in transactions involving investment services and products.
  • Existing private and public efforts to educate investors.

The SEC Office of Investor Education and Advocacy (OIEA) already has started reviewing public and private education efforts that it knows about, officials say.

The SEC is asking commenters to tell it about the investor education programs their organizations organize and to list what commenters believe to be the most important characteristics of an effective investor education program.

The SEC also asks for the results of independent evaluations of investor education programs and for any statistical evidence showing how a program might have changed participants’ behavior.

- Allison Bell

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