SEC Commissioner Daniel Gallagher said Wednesday that since the passage of the Dodd-Frank Act four years ago, the law's rulemaking mandates have been an "unfettered distraction" for the securities regulator and that the agency has been on a "death march" to finish Dodd-Frank rulemakings that are unrelated to its core mission.
"The amount of time consumed" at the Securities and Exchange Commission on Dodd-Frank rulemakings that are "entirely unrelated to the agency's core mission and entirely unrelated to what caused the financial crisis itself is a shame, and taxpayers should be horrified," Gallagher told attendees at an event held jointly by the libertarian Cato Institute and George Mason's market-oriented Mercatus Center at the Newseum in Washington.
The event was titled "After Dodd-Frank: The Future of Financial Markets."
Gallagher opined that the root cause of the financial crisis was "failed federal housing policy and loose monetary policy," none of which was addressed in Dodd-Frank.
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While the agency has completed 42 rulemakings out of 100 mandated ones, Gallagher added that it was a "silly notion" to think that the SEC could actually meet the one- to two-year deadlines imposed by Congress.
"Unfortunately," he said, the SEC is "still getting lots of pressure to finish the remaining 58 rulemakings on its plate."
Indeed, in comments a day before, former Sen. Chris Dodd, D-Conn., noted that the rulemaking process at agencies "has slowed," with agencies like the SEC having "far too many rules to implement."
Scott O'Malia, a commissioner at the Commodity Futures Trading Commission, who spoke on the panel with Gallagher, conceded that while "four years later we're not going to undo Dodd-Frank," he noted the CFTC has "massive regulatory mandates, yet our capacity to implement them ourselves is just not there."
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Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
