The Senate Committee on Banking, Housing and Urban Affairs held a hearing today on the nomination of Mary Jo White to chair the Securities and Exchange Commission. The Senators showed high support for White’s nomination and, contrary to expectation, asked few tough questions about her ties to Wall Street banks arising from her work at the law firm Debevoise & Plimpton LLP and other potential conflicts of interest.
In her remarks to the Committee, White indicated that her priorities would be the following: (1) finishing the Dodd-Frank and JOBS Act rulemaking mandates; (2) strengthening the SEC’s enforcement function; (3) making sure the SEC understands all aspects of today’s “high-speed, high-tech and dispersed” marketplace in order to provide for optimal regulation; (4) regulating money market funds and private fund advisers; (5) regulating credit rating agencies; (6) formulating appropriate standards and regulations for the conduct of broker-dealers and investment advisers that provide investment advice to retail customers; and (7) making public issuer disclosures more meaningful to investors.
White pledged to focus on the remaining Dodd-Frank and JOBS Act rulemakings and drive those regulations as “quickly and smartly” as possible. In response to questions, she also emphasized continuing attention to robust cost-benefit analysis with respect to SEC rulemakings that includes more attention to the quantification (where possible) of the benefits of a regulation. While she declined to detail any specific timing or the order of addressing particular rules, she indicated her support for following Congress’s policy judgments and carrying out the rulemakings expeditiously.
In terms of enforcement, White stated that, if confirmed, she would make it a “high priority” to strengthen the SEC’s enforcement function. She emphasized that the SEC will continue to proceed vigorously against wrongdoers, both individual and institutional, and reassured the Committee that there is no institution that is “too big” for the SEC to charge.
White also noted the challenges of today’s marketplace, including the impacts of high-frequency trading, complex trading algorithms, dark pools, and new order types. It would be an early priority, she remarked, to invest in technology in order for the SEC to keep pace with the markets, understand how these practices affect the marketplace, and undertake an appropriate response to these practices.