- Download: NASAA Testimony
WASHINGTON, DC, April 28, 2017 – In testimony before the House Committee on Financial Services, the North American Securities Administrators Association (NASAA) today urged Congress to remember the lessons learned from the financial crisis of 2008 as it considers provisions in the Financial CHOICE Act that will weaken critical investor protections.
“The reforms and investor protection provisions in the Dodd-Frank Act were born of necessity: trust in the market needed to be restored if our system of capital formation was to thrive. By passing the Dodd-Frank legislation into law, Congress signaled the beginning of a new era of financial market oversight and investor protection, including reforms intended to better empower state securities regulators to protect citizens from fraud and abuse,” said Maryland Securities Commissioner Melanie Senter Lubin, a member of NASAA’s Board of Directors.
Lubin pointed out that the bill is predominantly deregulatory in nature. Specifically, Lubin singled out provisions in the legislation that would weaken oversight of private securities markets and reforms; water down language intended to expand fiduciary obligations to investment professionals; lower standards for securities sold to the investing public; and dilute rules that keep “bad actors” out of securities markets.
Lubin also testified that a provision in the legislation, Section 391, which would mandate the adoption of policies governing the coordination of state and federal enforcement actions.
“Currently, state and federal regulators regularly communicate and coordinate on joint actions without the need for the types of prescriptive policies described in this provision,” Lubin said. “Our working relationship ensures that the jurisdictional reach of the regulators remains unhindered and that harmful conduct is addressed without the need to work through federal bureaucratic obstacles.”
“Because state securities regulators prioritize the protection of retail investors, forcing states to take a back-seat during investigations that involve more than one agency would put these “mom and pop” investors more directly in harm’s way,” Lubin said.
Lubin said NASAA looks forward to working cooperatively with the committee, as well as all members of Congress and fellow regulators, to ensure that Americans continue to benefit from effective regulation, strong investor protection, and robust and transparent capital markets.
A full copy of Commissioner Lubin’s testimony is available on the NASAA website at www.nasaa.org.
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