Which Comments on New Rules Get Read? Which Get Dropped? — SEC Roundup
Welcome to SEC Roundup, a bimonthly video series by former Securities and Exchange Commission senior trial counsels Nick Morgan and Tom Zaccaro, founders of Investor Choice Advocates Network, a nonprofit advocacy group.
For advisors, wealth managers and compliance professionals, navigating the SEC's rulemaking machine often feels like watching a high-stakes poker game played behind tinted glass.
Each time the agency proposes a new rule under the Administrative Procedure Act, a massive battle for industry influence kicks off. Trade groups scramble, compliance officers fire off warnings and the public comment portal fills with thousands of letters.
But once those comment letters are submitted, what actually happens inside the regulatory black box? Whose voices are codified into final law, and whose get quietly dropped?
In this episode of SEC Roundup, Morgan and Zaccaro welcome two professors, Gabriel Voelcker (Tuck School of Business at Dartmouth) and Gabriel Pündrich (Warrington College of Business at the University of Florida), to discuss their new paper, "Constituent Interests in SEC Rules: Evidence from Voluntary Comment Letters," co-authored with Chuck Thomsen.
By deploying large language models to digest a data set of 65,000 letters and 400,000 individual responses over three decades, their research categorizes commentators into four distinct camps: corporations, sophisticated asset managers, professional experts and mom-and-pop retail investors. The results reveal a striking divide.
See the video for the discussion.
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