Mary Jo White, President Obama’s nominee to chair the Securities and Exchange Commission, today called for "appropriate" standards and regulations governing the conduct of broker-dealers and investment advisors when providing investment advice to retail customers.
In testimony before the Senate Banking Committee, White,, a former legal counsel to financial institutions and former U.S. Attorney for the Southern District of New York, said there should be a balance “when necessary” of the SEC’s missions to protect investors, maintain fair orderly and efficient markets, and facilitate capital formation.
As SEC chair, she said her highest priority would be to expeditiously finish the rule-making for the Dodd-Frank and Jumpstart Our Business Startups (JOBS) acts.
Because of her corporate work, critics on the left have questioned her commitment to go after violators. She said enforcement must be fair, but also bold and unrelenting.
“Proceeding aggressively against wrongdoers is not only the right thing to do, but it also will serve to deter the sharp and unlawful practices of others who must be made to think twice—and stop in their tracks—rather than risk discovery, pursuit, and punishment by the SEC.,” she said.
When pressed by Sen. Sherrod Brown (D-Ohio) on whether she agrees with Attorney General Eric Holder, who recently said some financial institutions are “too big to jail,” White said the Justice Department does consider the consequences for employees, shareholders and the public when deciding whether to file criminal charges against an institution.
At the SEC, she said, there is not a financial company that is too big to be subject to civil charges, but the regulator considers collateral consequences in its remedies.
On money market mutual funds, she said new regulations should not hurt the value of the investment product. White said she would like the rule-making on the funds come from the SEC rather than the Financial Stability Oversight Council, which is proposing recommendations.