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January 27, 2014 at 07:50 AM
Securities and Exchange Commission Chairwoman Mary Jo White said Monday that besides implementing a new technology tool for examiners, the agency’s priorities this year are completing money market fund reforms, final implementation of crowdfunding as well as further monitoring of Rule 506 private offerings.
In her speech titled “The SEC in 2014” before the 41st Annual Securities Regulation Institute in Coronado, Calif., White failed to include a rule to put brokers under a fiduciary mandate as one of the agency’s priorities this year.
However, Barbara Roper, director of investor protection for the Consumer Federation of America, believes the issue is still on the agency’s radar. White “doesn’t suggest that these are her only priorities for rulemaking or even her top priorities,” Roper told ThinkAdvisor in an email message.
Added Roper: “We recognize that there are a lot of issues demanding the commission’s time and attention, not least the still incomplete rulemakings to address root causes of the financial crisis,” but “we have been assured that the staff is continuing to work on the economic analysis that will underlie any fiduciary rulemaking.”
Neil Simon, vice president of government affairs for the Investment Adviser Association, agrees that a fiduciary rule “remains a goal of the SEC,” but that “the timetable is uncertain.”
A “critical priority” to complete in the “relatively near term,” White said, is completing money market fund reform.
As it stands now, the commission is considering two “significant proposals” for additional reform that were put out for comment last June: a floating net asset value for prime institutional money market funds — the type of fund that experienced problems during the financial crisis — and a proposal to require money market funds under certain circumstances to impose a liquidity fee and permit the imposition of redemption gates.
The latter is designed to stop a “run.” As White stated previously, these proposals could be adopted alone or together.
“We have received hundreds of letters on the proposals with a wide range of differing views that we are reviewing closely,” White said.
Also on the agency’s priority list is the final implementation of crowdfunding and an updated Regulation A. “I expect that the commission, after thorough consideration of all comments, will move expeditiously to finalize these rules,” White said.
In what White described as “the start of what promises to be a period of transformative change in capital formation,” she said that in 2013, according to the SEC’s estimates, capital raised in non-SEC-registered offerings totaled $1.6 trillion, with more than 65% raised in new and ongoing Rule 506 offerings. Meanwhile, public offerings raised $1.3 trillion.
