The Securities and Exchange Commission said today it has forged agreements that will make it easier to share financial information with financial regulators in Europe and the Cayman Islands.
The SEC said it has signed memorandums with the Cayman Islands Monetary Authority (CIMA) and the European Securities and Markets Authority (ESMA) that will improve oversight of regulated financial entities that operate across national borders.
The action will expand the SEC's power to share and gather information about regulated entities such as investment advisors, investment fund managers, broker-dealers and credit rating agencies.
The agreement outlines what procedures and mechanisms the SEC and its counterparts in Europe and the Cayman Islands can use to collect and share information when they're suspicions of a violation of either jurisdiction's securities laws, and after a potential problem has arisen.
The agreements also permit the SEC and its counterparts to conduct on-site examinations of registered entities located abroad.
Ethiopis Tafara, director of the SEC's Office of International Affairs, said the agreements "help the SEC build closer relationships with its counterparts to cooperate and consult on each other's oversight activities in ways that may help prevent fraud in the long term or lessen the chances of future financial crises."
The Cayman Islands is a major offshore financial center and home to large numbers of hedge funds, investment advisors and investment managers that frequently access the U.S. market. ESMA is a pan-European Union agency that regulates credit rating agencies and fosters regulatory convergence among European Union securities regulators.
The agreements are along the same lines as arrangements the SEC has reached with authorities in Canada since 2010.
--Jim McConville