The SEC fights regulatory overhaul

By Felix Salmon
May 21, 2009

It’s great news, I think, that the SEC’s Mary Schapiro lost no time in pushing back against the new regulatory structure which seems to be emerging in Washington: it means that we’re actually getting somewhere here.

I hope and believe that Schapiro’s campaign won’t get very far, for two reasons: Schapiro personally comes from the financial industry — she was head of the toothless Finra — and therefore hasn’t built up a lot of credibility as a regulator; and the SEC institutionally is unsalvageable in any event.

At the same time, the fact that Schapiro is fighting back so quickly and sharply shows that this plan has a good chance of actually happening — complete with the SEC losing a lot of its present powers. What’s more, Schapiro coming out against reform in this manner only serves to place her in the anti-reform camp — which will weaken her arguments going forward. Elizabeth Warren — the inevitable first head of any new consumer-facing regulator — should be very happy indeed at this development.

2 comments

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Well, why wouldn’t the SEC fight reform. Has anyone had to pay for their mistakes like the rest of the business world, or do they just get a little smaller bonus. Reforms are long overdue.

Would I risk my money in the market or with some investment bank. No Way.

Posted by f belz | Report as abusive

Shapiro did a great job in cleaning up the futures industry while topping the CFTC. No doubt, she would have pushed back much harder against Greenspan and Robert Rubin when they told Congress to strip CFTC’s oversight of the OTC derivatives market.