WASHINGTON— Republicans seem to be trying to starve the U.S. Securities and Exchange Commission of the resources it needs to police the sale of investment products, Rep. Gary Peters said today at the fiduciary standard hearing.
A Democratic member of the House Financial Services Committee today defended the Securities and Exchange Commission, arguing that Republicans "seem unwilling" to provide the agency with the resources to properly police sale of investment products.
Rep. Gary Peters, D-Mich., said during a hearing on the fiduciary standard today that, "Consumers are not being served if they're not receiving access to investment quality advice."
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And, in commenting on the issue on who should regulate investors, Peters said, "Whatever regulator will regulate investment advisors in future, it's important they be given resources needed.
"But Republicans seem unwilling to do this," he said.
His comments were made at a hearing of the Capital Markets and Government-Sponsored Enterprises of the House Financial Services Committee, on whether there is a need for a uniform fiduciary standard, whether the SEC and the Department of Labor should coordinate their differing rulemaking on the fiduciary standard, and who should regulate investment advisors, the SEC or a self-regulatory organization, such as the Financial Industry Regulatory Authority.
Rep. Jim Hines, D-Conn., agreed. "The SEC needs funds to carry out Its new powers. Government watchdogs of Wall Street have long been outnumbered."
In defending the agency's decision to move promptly in crafting a rule implementing a uniform fiduciary standard, Rep. Stephen Lynch, D-Mass., said, "It is important that we foster environment in which clients can growth their investments wisely.
"We must ensure that regulators have resources to keep investors well informed and their money safe," Lynch said.
Rep. Maxine Waters, D-Calif., a rnaking minority member of the panel, added that, "Research indicates that average investor doesn't understand difference between broker-dealers and investment advisors."
She said that, as line is blurred…I applaud SEC study concluding that both IAs and BDs should be subject to a harmonized fiduciary standard.
"I believe that differences can be worked out; no need to stop rule-making in its tracks," Waters said. "Let government agencies do their job; it's essential that let SEC do its job."
Rep. Carolyn Maloney, D-N.Y., said, "I do not oppose SEC, but I want to be sure that proper economic analysis is done to ensure that consumers are protected.
"Something needs to change; the status quo is not acceptable," she said.
But, Rep. David Schweikert, R-Ariz., wondered: "Are we heading towards unintended consequences by reducing choice of products and advice?
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