New York, for example, which would oversee about 350 additional advisors, doesn't have a stand-alone examination program, according to Crawford's letter. Larger advisors fall under the jurisdiction of New York State Attorney General Andrew Cuomo, who can investigate them in instances of alleged fraud. A spokesman for Cuomo's office declined to immediately comment.
California would take on about another 600 advisors and have to adopt new fees to cover the added costs, said Preston DuFauchard, California's corporations commissioner. The state now conducts about 300 exams annually-about one exam per advisor every 10 years, he said.
McCarthy also requested the number of state regulator agencies whose budgets were reduced during the upcoming fiscal year. "NASAA does not have the data necessary to answer this question, but would reiterate its contention that many state securities regulators have not experienced the same budget strains as general revenue funded agencies," wrote Crawford in her response.
Crawford confirmed the contents of the letter in an interview with Dow Jones Newswires on Tuesday and, regarding the absence of some relevant information, said: "We did the best we could at the time."
"You can't be confident that the resources are there, but I can tell you that we'll do a better job than the SEC, because the SEC isn't doing that job," she said.
A spokeswoman for McCarthy's office confirmed the congresswoman's letter, but didn't immediately respond to requests for additional comment.
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