Two U.S. senators have asked for answers from the Securities and Exchange Commission about their rulemaking process. They made their request following the latest SEC Inspector General report that “raises significant concerns that the agency is trying to enact too many rules, too quickly.”
‘SEC Is Enacting Rules Without Sufficient Feedback’
U.S. Senator Pat Toomey (R-PA) and Representative Patrick McHenry (R-NC) sent a letter to the chairman of the Securities and Exchange Commission (SEC), Gary Gensler, requesting information regarding the agency’s rulemaking process on Wednesday.
The October report by the SEC Inspection General (IG), an impartial office responsible for conducting, supervising, and coordinating audits and investigations into the SEC’s programs and operations, was referenced in this letter.
Senator Toomey Tweeted Friday
I’m deeply concerned by the IG report finding that the SEC is enacting rules without sufficient feedback.
The letter details that the IG report “raises significant concerns that the agency is trying to enact too many rules, too quickly — in some cases using temporary staff with little or no rulemaking experience — to the detriment of investors, businesses, and American capital markets.”
According to the IG report, 26 new rules were proposed by the SEC from January through August 2018. This was twice the number of new rules it suggested during 2021, and more than the five previous years.
Following the release of the report, Rep. McHenry tweeted: “A damning new IG report shines a light on Gary Gensler’s reckless leadership of the SEC.” He opined:
Chair Gensler’s attempt to force a progressive agenda through our capital markets is taking resources from the SEC’s core mission — including investor protection.
Continue reading the letter:
Your office effectively cut these offices from the rulemaking process. This has limited their ability to give valuable and meaningful feedback on the effect of draft rules upon small business investors.
They ended the letter by asking Gensler a series of questions about how the SEC will address the issues identified within the IG report. Gensler should respond no later than November 16.
Last week, four congressmen sent a letter to Gensler accusing him of “hypocritical mismanagement of the SEC,” stating that the chairman refused to practice what he preaches. Gensler was also criticised for his enforcement-centric approach when regulating the cryptocurrency industry.
Do you agree with the lawmakers that the SEC’s rulemaking process is concerning? Please let us know your thoughts in the comment section.
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