Said Gallagher: "Some folks have come to us and said do a rulemaking because it will stave off Labor. I don't like rulemaking to stave off other people; [An SEC fiduciary rule has] to make sense based on the merits. And I'm not convinced that [an SEC proposal] would" stop the DOL from reissuing a rule proposal.

DOL is "going to do what they do," and DOL is "dealing with different issues and a very different statutory construct" under ERISA, Gallagher said. Plus, he said, Section 913 of the Dodd-Frank Act is "very limited" in the authority it gives. "It is important that our staffs are working closely together [on the fiduciary rulemaking], and they are."

While SEC Chairwoman Mary Jo White has said the commission would decide this year whether to move forward on a fiduciary rule, Gallagher said that "in many languages, 2014 can mean never."

Gallagher, a Republican, who reiterated that he has yet to be convinced that an SEC fiduciary rulemaking is needed, also noted that he wasn't sure whether DOL would stick to its planned August redraft release.

He also said that he worries about moves by special interest groups who see the fiduciary issue as a "great election year issue" to push for roll out of the DOL and SEC fiduciary rulemakings between now and the November elections.

Gallagher also revisited comments he made in a recent speech about the need to boost the number of advisor exams, and that the commission should fix the exam imbalance between brokers and advisors by allowing third-party advisor exams — including "potentially, defining the term 'third party' to include SROs in order to allow the SROs currently involved in broker-dealer oversight to conduct examinations of 'dual hatted' investment advisors as well."

Gallagher said during the FINRA event Tuesday that the commission's current seven-year exam cycle of advisors is leaving the agency vulnerable to missing another Madoff-type fraud. "We are just sitting there as an institution with our chin out waiting to get pummeled," he said. "We're not even 'there' with advisors" in terms of an adequate number of exams.

Gallagher suggested at the FINRA event that the SEC create a rule to allow advisors to have third-party exams. But such a rule, he said, would "not mandate SROs" (such as FINRA) to be the third party, noting that such a rule would "allow choice."

However, he conceded that how the SEC would oversee those third-party auditors would have to be determined.

In talking with reporters on the sidelines of the FINRA event, Gallagher clarified that given that the SEC already has the authority to examine advisors, the rulemaking regarding allowing third-party audits would delve into "how [the SEC] examines advisors," giving advisors the option to get a third-party review.  

"I congratulate Gallagher on bringing that issue [of third-party exams] forward," Ketchum said during a coversation with reporters, noting that he see little political appetite for Rep. Maxine Waters' bill, the Investment Adviser Examination Improvement Act of 2013, H.R. 1627, which would allow the SEC to collect user fees from advisors to fund their exams.