On July 7, the Securities and Exchange Commission and the Board of Governors of the Federal Reserve System signed a memorandum of understanding which will result in the two agencies sharing information and cooperating in a number of important areas of common interest including anti-money laundering, bank brokerage activities under the Gramm-Leach-Bliley Act, clearance and settlement in the banking and securities industries, and the regulation of transfer agents.
SEC Chairman Christopher Cox stated, "This agreement represents a valuable coordination of the roles of the SEC and the Fed in our capital markets... [T]he interconnectedness of mortgage and lending markets, credit derivatives, securitizations, and counterparty relationships requires the U.S. government to adopt a more coherent and coordinated approach... This is smart government."
This cooperative effort was stimulated by the recent stress in the financial markets affecting commercial and investment banks as well as many other market participants, and will give the Federal Reserve access to critical information with respect to such banks. The SEC recently entered into a similar memorandum of understanding with the Commodity Futures Trading Commission. An agreement between the SEC and the Department of Labor is anticipated later this summer.