Sen. Elizabeth Warren, D-Mass. (Photo: NLJ)

Sen. Elizabeth Warren, D-Mass., used a Tuesday Senate Banking Committee hearing on oversight of the cryptocurrency market to take Securities and Exchange Commission chief Jay Clayton to task over the agency’s upcoming fiduciary rule proposal.

(Related: Congress May Need to Sort Out Crypto Regulation, SEC Chief Says)

Here’s their exchange:  

Warren: “Can you state to this committee that any rulemaking you do on this topic will not weaken existing protections for retirement savers?”

Clayton: “From what baseline?”

Warren: “We have a rule from the Labor Department; you could strengthen the rule, you could pass the same rule or you could weaken the rule. I want to know that you’re not going to weaken the rule — that’s all I’m asking you.”

Clayton: “Here’s what I’m trying to do: The relationship between an investment advisor, broker-dealer and their client … — they have a 401(k), they have an annuity, and they have a few stocks — is regulated … by no less than five people. And they all have different standards. My main objective is to bring clarity to that without jeopardizing investor protection.”

Warren: “But that’s the question I’m asking, about whether or not you’re jeopardizing the protection that people are trying to save for their retirement get. Clarity could be, ‘Do whatever you want.’”

Clayton: “I think it’s a combination of insufficient standards in some places, which we are looking to increase. A lack of clarity, also the standard is only as good as the remedy available. One of the things I’m also looking at — believe me, we’ve spent a lot of time on this space trying to get it right — one of the things we’re looking at is ‘what dollars do you actually collect when somebody has done you harm?’ Because you could have a really strong standard, but if there are no dollars there, that’s a problem.”

Warren: “I agree with you, Mr. Chairman, if you want to strengthen enforcement of this rule or strengthen this rule itself, count me in. That’s what the American people look to the SEC for.”