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SEC Assembles Team to Craft Fiduciary Rule

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The Securities and Exchange Commission has assembled the team of officials who will be instrumental in coordinating a fiduciary rulemaking with the Department of Labor.  

The agency announced Thursday that Dalia Blass will serve as director of the agency’s Division of Investment Management, replacing David Grim, and that John Cook is the new lead advisor to SEC Chairman Jay Clayton on matters involving IM, the Division of Economic and Risk Analysis (DERA), and on enforcement matters.

Jeffrey Harris, former chief economist at the Commodity Futures Trading Commission, was also named director of DERA, replacing Mark Flannery. 

Blass previously served in leadership roles in the IM division, most recently as assistant chief counsel. 

Former IM director Norm Champ told ThinkAdvisor that Blass’ “extensive experience at the SEC makes her uniquely qualified to work on crafting a fiduciary standard applicable to all investment advisors and broker-dealers.”

Champ said that he looks forward to seeing the SEC “assert its leadership in this area because the DOL’s attempts have been fundamentally misguided in imposing a fiduciary duty on advisors to retirement accounts.”

Champ also believes Blass’ expertise in “exchange-traded funds could drive adoption of a plain vanilla ETF rule to speed the process for creation of index-based exchange-traded funds.”

Blass rejoins the agency from Ropes & Gray LLP, where she has advised on a broad range of investment fund, private equity and regulatory matters. She previously practiced law at O’Melveny & Myers LLP, and began her career in the London office of Shearman & Sterling LLP.

During her SEC tenure of more than a decade, Blass received the SEC’s Manuel F. Cohen Award, which recognizes outstanding legal ability and performance.

“The investment management industry is constantly evolving, yet its integrity is vital to our markets and Main Street investors,” said Clayton, in a statement. “I know Dalia and the dedicated team in the Investment Management Division recognize this and will continue to work every day to fulfill the SEC’s mission.”

Cook joined the SEC in 2010, previously serving as a senior special counsel in DERA and in the Office of the Chief Accountant, as well as a counsel to former Commissioner Daniel Gallagher. Before joining the SEC, Cook practiced law at Gibson, Dunn & Crutcher LLP, representing clients in regulatory matters. He earned his J.D., cum laude, from Harvard Law School and an undergraduate degree, magna cum laude, from the Georgetown University School of Foreign Service. 

Harris is currently a professor and the Gary D. Cohn Goldman Sachs chair in finance at Kogod School of Business at American University in Washington.

He is credited with having an “extensive background” in market microstructure and regulatory issues, and recently served as , with prior experience as visiting academic at the Nasdaq Stock Market and at the SEC. 

Blass earned a J.D. from Columbia University School of Law, where she was Harlan Fiske Stone Scholar and executive editor of the Journal of Transnational Law. She received her B.A in international studies from the American University and studied political science at the American University in Cairo. 

Investment Company Institute President Paul Schott Stevens said in a statement that Blass “has superb credentials for the job, including her many years of prior service in the division, her asset management–focused law practice, and her widely recognized expertise on fund issues and regulation. We are confident that she will exercise strong leadership on regulatory initiatives that are critical to mutual funds, exchange-traded funds.”

Harris holds an undergraduate degree and MBA from the University of Iowa and a Ph.D. in finance from The Ohio State University. 

— Check out SEC Issues More Guidance on Form ADV Changes on ThinkAdvisor.