SEC Chairman Mary Jo White said today the agency won’t hesitate to take enforcement actions if advisor fee disclosures are false or misleading.
In a speech before the Consumer Federation of America, White also said she has instructed Securities and Exchange Commission staff to make developing options on whether and how to harmonize regulations for investment advisors and broker-dealers (including a possible uniform fiduciary duty) an immediate priority.
When asked after the speech, she would not give a definition of “immediate.”
Speaking about when advisors and broker-dealers offer personal advice to retail investors, White said, “Whenever you have substantially similar services regulated differently, I believe it is necessary to consider carefully whether the regulatory distinctions make sense.”
On another matter, White said she is worried investors often purchase variable annuities without understanding what they are buying.
The SEC will be seeking violators to acknowledge wrongdoing (in contrast to the agencies traditional “no admit, no deny” policy), particularly in instances of egregious conduct, where large numbers of investors were harmed, where the markets or investors were placed at significant risk, where the conduct obstructs an SEC investigation, where an admission can send a particularly important message to the markets or where the wrongdoer poses a particular future threat to investors or the markets.
White said the agency’s new Dodd-Frank Office of Investor Advocate will be “very very useful,” but added every employee at the SEC should be an advocate for investors.
The SEC’s staff is discussing commissionerss recommendations for final rules on how the agency should monitor Internet advertising and other aspects of the JOBS Act.
She noted the SEC is moving forward on rules for target-date fund advertising.
On the agency’s initiative to develop rules to improve corporate disclosures, she said the SEC is not focused only on the content of disclosures that investors need to make informed investment and voting decisions, but also how, where and when companies should make disclosures to make them more meaningful to all investors.