Editor’s note: This article first appeared in Human Capital, a newsletter by Washington Bureau Chief Melanie Waddell about the people who shape the financial regulatory space.
Welcome back to Human Capital! This week’s regulatory warrior is Kara Stein, a commissioner at the Securities and Exchange Commission, who’s been prodding SEC Chairman Jay Clayton behind the scenes to “prioritize” putting investment advisors and broker-dealers under the same cybersecurity rules as exchanges and clearing firms.
Stein, a Democrat, made her wishes known in a recent speech as she outlined why advisors and BDs should be put under what she dubs “Regulation SCI 2.0.”
Read on to hear about Stein’s cyber plans as well as the lowdown on yet another tech-related term: “TechFins.”
Advisors and Broker-Dealers Under Reg SCI
Stein noted in her speech the advent in November 2014 of Regulation SCI — which stands for systems compliance and integrity, and requires market participants like exchanges and clearing platforms to have written policies and procedures that prove their computer systems can bounce back from disasters.
But Reg SCI didn’t go far enough, Stein argues, and has “left out many participants” and other “key players” that possess investor information, such as broker-dealers, investment advisors and transfer agents.
She’s asked Clayton to prioritize what she calls Regulation SCI 2.0.