SEC Investor Advisory Members to Deal with Crowdfunding, Fiduciary Standard, and Pay Ratio Disclosures

According to the Securities and Exchange Commission Investor Advisory Committee, its subcommittees are try to come up with possible recommendations about crowdfunding, a uniform fiduciary standard, and pay ratio disclosures. Also during the first quarter of this year, the SEC is expected to seek economic data that is supposed to help it decide whether it should establish a uniform fiduciary standard for investment advisers and broker-dealers that gives investment advice to retail investors.

Under Section 911 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the committee has to “advise and consult” with the Commission on its investor protection initiatives and rulemaking priorities. While the SEC is not required to act on the recommendations, it must “promptly” evaluate them and disclose whether it will take related action. The committee’s first set of recommendations, to make the general solicitation ban under the Jumpstart Our Business Startups Act less stringent, was issued last year.

At the SEC Investor Advisory Committee’s January 18 meeting, subcommittee chairpersons talked about current and ongoing efforts. Investor as Purchaser subcommittee chairman Barbara Roper said that her group and the Investor Education subcommittee are working together to figure out where in a possible crowdfunding regime investors may be facing possible risks. Also, the group is trying to figure out where investor education might be most needed.

Meantime, Investor as Owner subcommittee chairman Anne Sheehan said her group intends to set up a meeting that includes shareholders and issuers so that they can talk about how the SEC can make companies reveal a ratio that compares the median yearly income of employees’ to that of their CEOs. The Dodd-Frank Act also ordered this rulemaking.

As for Market Structure subcommittee Chairman Steven Wallman, said that his group is talking to the Depository Trust and Clearing Corporation about a report that the DTTC commissioned to find out whether establishing shorter settlement cycles for municipal bonds, corporate bonds, and equities would benefit the market. Wallman says that the DTTC’s report needs to provide more research on how these cycles might affect retail investors. The subcommittee also wants to make progress when it comes to certain market structure issues, such as dark pools, decimalization, and market fragmentation.

Investor Advisory Committee Meeting, SEC, January 18, 2013

Investor Advisory Committee Meeting, SEC, January 18, 2013

Institutional Investor Fraud
Our institutional investment fraud attorneys represent clients nationwide. Contact our securities fraud law firm today.

More Blog Posts:
Pension Plans’ Shareholder Derivative Claims Against UBS is Reinstated by 1st Circuit Appeals Court, Institutional Investor Securities Blog, January 4, 2013

Clearing House Association Wants Greater Protections for Clearing Members, Institutional Investor Securities Blog, December 31, 2013

District Court in Texas Dismisses Securities Fraud Case Against Sports Franchisor, Stockbroker Fraud Blog, December 15, 2012