SEC Chairman Requests Broad Investigative Power
Thursday, July 16, 2009; 5:22 PM
Securities and Exchange Commission Chairman Mary Schapiro has requested that Congress change federal laws to give her agency new powers to investigate financial wrongdoing.
In a list of 42 legislative requests (see full list) made to Congress this week, Schapiro asks for new powers to pay whistleblowers and expanded access to grand jury material usually reserved for federal prosecutors. Currently, the SEC can only pay whistleblowers for their help in insider trading cases.
Congress is beginning this summer to work on reforming financial regulation. The Treasury Department has unveiled a series of major legislative proposals for new legal authorities to enable the SEC and other regulators to oversee derivatives, executive compensation and other issues. The Treasury submitted legislation on compensation today.
In addition to the new whistleblower powers, among the notable legislative requests:
-- The SEC could bar a bad actor who had worked for a brokerage company from serving as an investment adviser, or vice-versa
-- Brokerage companies that sell mutual funds would be free to set their own prices for what they charge consumers. Currently, these fees are set by the mutual funds themselves.
-- The SEC would be able to inspect the records of banks serving as custodians for funds and investment advisers
-- The Public Company Accounting Oversight Board would have the power to oversee auditors of brokerages, not just public companies.
-- The SEC could bypass federal requirements to more quickly hire industry experts that the agency needs.