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Tuesday, September 21, 2021
NASAA Annual Conference
Chicago, Illinois

Thank you, Lisa, for your very kind and generous introduction.

Before I begin my remarks, I’d like to first acknowledge and thank Lisa for the excellent work she has done over the past, very challenging year as NASAA’s President. You have done a magnificent job in successfully leading this organization with visionary leadership, skillful mentorship, and incredible eloquence and grace.

On behalf of our membership, I wish to commend you for your well-deserved honor of receiving NASAA’s Blue Sky Cube. Your dedication throughout this year of continually putting investors first in efforts to protect them against securities fraud reflects your fierce commitment to NASAA’s mission. As stated on your Blue Sky Cube, your significant contributions will forever benefit NASAA and our fellow regulators.

Very well done and thank you, Lisa.

Good afternoon.

I am extremely humbled as I begin my service as president of the North American Securities Administrators Association.

I want to welcome, acknowledge, and thank the NASAA members, industry representatives and other stakeholders who have joined us for our 2021 Annual Conference.

I would like to thank our generous hosts – the Securities Department of the Illinois Secretary of State – for welcoming us to your great state and city – and a special thank you to the Secretary of State Jesse White for his inspirational words to us.

This conference would not have been possible without the outstanding work of Illinois Securities Department Director, and our Conference Chair, Tanya Solov. Thank you for developing and facilitating great speakers and panels for us. You and your tremendous team have done an excellent job ensuring that all the i’s are dotted, and the t’s are crossed.

Thank you, Joey Brady, and the NASAA Corporate Office staff for, once again, organizing a terrific annual conference and for all that you and your staff do to support the NASAA membership.

And, considering we pivoted to a fully virtual event in a matter of hours, I want to reiterate my tremendous appreciation to Joey, Vince Martinez, James Apistolas, and Lonnie Martin. Your standard is always excellence. And, as always you have gone above and beyond the call of duty.

As we transition NASAA’s leadership, I wish to thank the outgoing NASAA Board members and Section Committee Chairs.

  • Travis Iles of Texas, and Chris Gerold of New Jersey have completed their terms on the Board of Directors. Chris as past president and Travis as a director.

We also have three Section chairs who will be leaving their roles.

  • Broker-Dealer chair: Marni Rock Gibson of Kentucky
  • Corporate Finance chair: Mike Pieciak of Vermont, and
  • Investor Education co-chair: Diane Young-Spitzer of Massachusetts

I appreciate all the work done by this amazing Board, our Committees, and our Project Groups that – against so many odds – have done so much to advance the NASAA mission over this past year.

Looking ahead, I am grateful for the wonderful team that we have continuing NASAA’s great work. It is my honor to introduce the 2021-2022 NASAA Board of Directors.

  • President-Elect: Andrew Hartnett of Iowa
  • Past-President: Lisa A. Hopkins of West Virginia
  • Treasurer: Claire McHenry of Nebraska
  • Secretary: Kevin Hoyt of New Brunswick
  • Board Member: William Beatty of Washington
  • Board Member: Leslie Van Buskirk of Wisconsin
  • New Board Member, Marni Rock Gibson of Kentucky
  • New Board Member, Diane Young-Spitzer of Massachusetts

I am also pleased to announce the Section Chairs and Vice-chairs for the upcoming year, subject to Board approval later this afternoon:

  • Broker-Dealer Section – Chair, Travis Iles of Texas; Vice-chair Brett Olin of Nevada
  • Corporation Finance Section – Chair, Andrea Seidt of Ohio; Vice-chair Peter Cassidy of Massachusetts
  • Enforcement Section – Co-chairs, Joe Borg of Alabama, and Chris Gerold of New Jersey; Vice-chair Joe Rotunda of Texas
  • Investment Adviser Section – Chair, William Carrigan of Vermont; Vice-chair Linda Cena of Michigan
  • Investor Education Section – Co-Chairs Tom Cotter of Alberta and Jillian Lazar of Delaware; Vice-chair Lynne Egan of Montana

We are fortunate in NASAA to have dedicated members who are willing to offer their considerable talents to help lead our many committees and project groups. The section chairs, co-chairs and vice chairs bring a diverse mix of skills and talents, new perspectives, and considerable experience to these roles. We are going to roll up our sleeves and have a productive and successful year together.

We are also fortunate to have a strong, dedicated team at the Corporate Office. Whether it’s reviewing and commenting on regulatory proposals or legislation, drafting amicus briefs, advising the Board, assisting Section Committees, planning our meetings, or managing all aspects of our internal operations, they bring their A-game every day. Thank you all.

Just recently, Policy & Government Affairs Director Mike Canning announced his pending departure from NASAA later this month to start a Government Affairs office in Washington, D.C. I want to take this opportunity to acknowledge Mike for his ten years of dedicated, insightful and successful work done to advance NASAA’s legislative and policy priorities on Capitol Hill. Mike put many of us through our paces preparing for Congressional testimony and made sure that we found our own distinct voices as we made sure NASAA’s position was heard loud and clear. Mike, thanks for making us look good and for all of your incredible work during your NASAA tenure!

I must take a minute now to share my deepest admiration and heartfelt thanks to a recently retired NASAA team member. Bob Webster retired in July after more than 18 years as NASAA’s Director of Communications. As a trusted professional, confidante and friend to 18 NASAA presidents, as well as to our members and colleagues, I want to express my gratitude to Bob for his dedicated service in support of NASAA’s mission.

By now, and I can say this very confidently, many of you have known me for a long time.

I joined the Maryland Division of Securities 35 years ago next month. For perspective, I started practicing law right after my Bat Mitzvah. Just kidding; but it does seem as if I’ve been involved with NASAA for just about as long as I have been a securities regulator. In fact, my first exposure to NASAA was when just a few weeks into my new job at the Division, two of the attorneys from our office were heading off to Hawaii for a NASAA Fall Conference, which also included some vacation time tacked onto the trip.  I made a “note to self” at that point to figure out what NASAA was and how I could get involved.

Looking back, just a month or so into my new job, I had an experience that remains with me to this very day. Our division’s philosophy has always been that you learn by doing, so I was interviewing an elderly married couple who had lost their entire life savings including the husband’s lump sum Bethlehem Steel pension to a Ponzi scheme. All the husband had wanted to do was to provide for his wife, who was several years younger but not able to work because of medical challenges. He was forced – in his early-80s – to leave retirement and return to the workforce to earn money for the two of them to pay for basic life necessities – to keep a roof over their heads, buy food, get medicine, and keep their insurance.  He went door to door applying for jobs, and eventually was hired at a local hardware store where he swept floors every night to make enough money to make ends meet.

In my time as a securities regulator, I have had a front row seat to many changes in the capital markets. But the one constant is that I remain as driven today by the same commitment to investor protection that led me to join the Maryland Division of Securities right out of law school and stay for all these years.

Many of you will remember Patty Struck, who was the Administrator for the Wisconsin Division of Securities, and a former colleague and dear friend to so many of us.

Patty often talked about our common denominator, as she called it. The Investor.

It is now almost 16 years to the date since Patty became NASAA President. She shared in her Inaugural address something she was taught by her dad, who was a member of the first class of Chartered Financial Analysts back in 1963. Patty said, “I learned from my father’s example that if we keep our focus on the investor, everything else falls into place.”

Her commitment to investor protection lives on and resonates with all NASAA members, with our fellow regulators, and with industry members.

While we are always aware of the events and outcomes that have led us to where we are today, we must continually look ahead.

As president, I view my role as guiding NASAA according to our strategic plan and our legislative agenda and relying on the vast skills and talents within our membership to tackle the emerging issues that will inevitably come our way.

During my tenure, we will continue to work with Congress and the SEC to advance our federal policy priorities — all of which focus on strengthening investor protection, especially for senior investors.

Since January, Congress has taken steps to address several of the concerns that NASAA has raised through our advocacy efforts. For example, the House recently passed a bill to establish a taskforce at the SEC that would coordinate with state regulators on efforts to protect elderly investors. In addition, lawmakers in the House and Senate introduced legislation to prohibit the use of mandatory pre-dispute arbitration agreements by broker-dealers and investment advisers.

Over the coming year, we will build on this early momentum. We expect that the House will hold a hearing to consider legislation to enhance the authority and independence of the SEC’s Investor Advocate and to advance other NASAA priorities, including legislation that would fund grants to help states combat senior fraud. We are optimistic that several lawmakers will join NASAA to examine policy solutions around Self-Directed Individual Retirement Accounts. We know that gaps in the oversight of SD-IRAS increasingly threaten the retirement security of millions of Americans, and we’re working with Congress to address those gaps.

We also anticipate that NASAA’s involvement in digital asset policymaking will continue to increase.

In addition, NASAA will continue to monitor government responses to the ongoing COVID-19 situation and continue, for the duration of the pandemic, to coordinate and share insights with NASAA members about activities at the federal and state levels.

As I mentioned earlier, NASAA is privileged to have within our membership an incredible wealth of exceptionally skilled individuals, both new and “seasoned,” from across North America. We are so fortunate that these skills run deep within the NASAA community. I will work with the Board and Corporate Office to look for opportunities to deepen our bench and seek ways to expand the talent within our Sections, Committees and Project Groups to better position us for the future.

We will certainly have our fair share of regulatory issues on our plates in the coming year. I’ll touch on a few of the issues that are priorities for me, as I’m sure they are for others.

Those of you who know me know of my longstanding concern with expungement.

You’ll also know that it is has always been NASAA’s position that expungement is an extraordinary remedy that should only be allowed in very limited circumstances. Despite most everyone’s best intentions, the current system of arbitrator-awarded expungements does not operate within these parameters. I look forward to continuing to work this year with the SEC and FINRA on changes to the expungement process to ensure that the remedy is obtained only under appropriate circumstances. Tightening the standards and procedures surrounding expungements is critical to stop the ongoing threat to the integrity of recordkeeping and to critical information needed by regulators making licensing decisions, firms making hiring decisions, and investors deciding whom to trust with their financial wellbeing.

While on the topic of trust, specifically investor trust, I want to talk about Reg BI. Maryland has always focused on investors understanding with whom they’re dealing. In fact, our investment adviser definition includes limitations on the use of terms that suggest to an investor that a financial professional may be a fiduciary even if he or she is not. That focus has led to my long-held belief that all financial services professionals should act in the best interest of their clients.

The NASAA Reg BI Implementation Committee has been masterful in engaging and informing members of the evolving regulations and statutes related to Reg BI — and in assessing how Reg BI is being implemented.

In the longer term, will Reg BI deliver and live up to its title? We are all paying close attention to that question. I look forward to results of the examinations being done under the auspices of our Reg BI committee and to see their recommendations of what the future should be for that regulation.

Another area that is receiving heightened focus is cryptocurrencies and digital assets, which, as we know, is appropriate given the astonishing growth in the size of the market. The debate will continue in earnest around the regulation of digital assets.

At the state level, we have used our authority to shut down scams and unregistered activities, and we will continue to use our authority to address illicit or violative conduct. This area is truly one where the soundbite – the return OF your investment is as important as the return ON your investment – resonates for investors and for all of us. NASAA will strongly weigh in on this evolving issue with policy makers and share our expertise in these areas to ensure that state regulators retain our authority to protect investors and regulate these products and services.

Relatedly, the emergence and growth of platforms offering commission free, or discount, trading combined with other services such as fractionalized shares or crypto trading demands closer scrutiny by regulators. The fact that these apps are accessible to most anyone with a smart phone is, in my opinion, at best an investor education opportunity and at worst – at your fingertips financial gambling with very real money. Coupling that accessibility with digital “nudges” or prompts raises significant concerns over the potential dangers that these apps present to novice investors or those without the means to sustain significant losses.

I am not suggesting that these platforms are inherently bad, but I am concerned that they purposely encourage – and might actually manipulate their users — toward speculative trading habits that are harmful to investors and the markets. The fact that these innovations open the capital markets to individuals or groups that might not otherwise have access could be a good thing, but the magnitude of profits being made through arrangements such as payment for order flow along with a lack of investor understanding of the risks, all raise concerns that the practice invites fraud and other misconduct. Innovation is great, but the rules still apply.

Diversity, Equity and Inclusion issues will remain in the forefront, and I am looking forward to the good work I know our DEI committee will undertake this year as they build on their impressive accomplishments. This week our membership adopted a DEI statement reinforcing and supporting NASAA’s culture of inclusion and diversity of people, thought, voices and experiences. The statement sets forth NASAA’s commitment to promote DEI in furtherance of our mission to protect investors, advance responsible capital formation, and ensure the integrity and efficiency of the capital markets.

I’m proud that, for the first time in NASAA history, two women are serving consecutively as NASAA President and that our Board has a majority of six women. And while we have made progress with regard to gender diversity, we know that there is much work to be done to meet our DEI aspirations.

In the year ahead, NASAA will continue to prioritize and reinforce this positive and important DEI effort. And we know that we are not alone. The SEC, FINRA and industry have DEI initiatives underway. We want to be involved in that work either by supporting or learning about what you are doing. I know that you will find a receptive audience at NASAA. Our DEI Committee co-chairs Noula Zaharis and Harvey McCleskey and the members of the Committee are only a phone call, email or Teams Meeting away.

NASAA means a lot to me, both professionally and personally. I admire everything that my federal counterparts do and that the self-regulatory organizations do, but I like being a state regulator –the local cop on the beat — the first place investors can go to reach somebody to help them. And I really think that if we were not in the picture there would be no one to fulfill that role the way we do.

But it is so much more than this. I am proud to represent state and provincial securities regulators who have dedicated themselves to government service and doing great work for the public good.

At the 2010 NASAA Annual Meeting in Baltimore, shortly after the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law, we had the honor to host my home state Congressional representative Elijah Cummings. His insightful words to state securities regulators still ring true. He explained that as regulators and policymakers we shared “inseparable and fully accomplishable goals” – those of the public and maintaining confidence in our financial system. Our work as state regulators is at the center of those goals – we spend our days working on and thinking about the issues that have the most impact on retail investors.

Throughout this year, Elijah Cummings’ words will continue to be with me.

As I start my term, I wish to recognize my husband, Brian. He’s been my partner for a very long time – we met in high school and have been married for 34 years this December, and our son Russell who is a college sophomore. I could not have done any of this without their love and support.

In addition, I wish to thank Maryland Attorney General Brian Frosh, our Deputy Attorney General Carolyn Quattrocki, our incredible staff in the Maryland Division of Securities, especially our Division’s deputies Dale Cantone and Kelvin Blake, and our incredible division manager and most importantly friend, Mary Louise Stanzyk.

As I said in the beginning, I am truly humbled to stand here today in this new role. I am humbled by the honor, I am humbled by the responsibility, I am humbled by the magnitude of the mission, and I am humbled by the power of our collective efforts to create positive change for investors.

In the NASAA tradition, we will seek to do what is best for investors, always. They expect and deserve no less from us.

Thank you.