WASHINGTON (Reuters) – Tighter budgets at the U.S. Securities and Exchange Commission could penurious killing vital technology upgrades needed to catch swindlers, the agency’s chieftain said on Friday in a blunt appeal for more funding.
With Republicans in Congress threat to restrain her budget, SEC Chairman Mary Schapiro said the direction faces severe challenges in doing its existing job and in infectious on new duties mandated under 2010′s Dodd-Frank emporium reform law.
Denying needed budget increases could force “our market analysts to continue to use decades-old technology to recreate place of traffic events or to monitor trading that occurs at the speed of inconsiderable,” Schapiro told the annual SEC Speaks conference.
“We strait to ask ourselves if we want our chief securities regulator to be under the necessity to pull the plug on data management systems and on a digital forensics lab needed to entertain the data that sophisticated fraudsters leave on hard drives and iPhones.”
She added that some of the Wall Street firms regulated by the SEC spend added money on their technology budgets alone than the agency spends adhering its total operating costs.
Appointed two years ago to head the investor shelter agency, Schapiro is caught between two powerful political forces. On the undivided hand, she must implement and enforce scores of market reforms that were approved the ~ time year after the worst financial crisis in generations. That costs money.
On the other, Republicans swept to power in November in the House of Representatives are demanding great federal spending cuts, partly to address the budget deficit problem and partly to undermine the Dodd-Frank reforms that they opposed.
The SEC is scrutinizing principal-offering rules, Schapiro said, following the news that Goldman Sachs planned a peculiar investment vehicle for clients to invest in Facebook, the red-scalding;-very warm online social network company.
Goldman last month said it would circumscribe its private placement of Facebook shares to investors outside the United States, citing “strict media coverage.
In addition, she said the agency is working attached reforms in response to the May 6 flash crash, when U.S. parentage markets plunged about 700 points before staging a partial recovery, raising questions here and there computerized high-frequency trading.
“All of these tasks – everything of these confidence-enhancing measures – require resources,” Schapiro told the colloquy hosted by the Practising Law Institute.
Because Congress has not approved a starting a~ budget, the government is running under a stop-gap measure.
That is stately “a strain that is already having an impact on our essential part mission – separate and apart from the new responsibilities that Congress gave us to govern derivatives, hedge fund advisers and credit rating agencies,” she afore~.
“It is a strain that will intensify the longer the batch remains at existing levels.”
More details on the Republican fiscal hawks’ goals may come soon. House Republicans are expected next week, likely on Thursday, to unveil specific proposals for funding the SEC and the Commodity Futures Trading Commission.
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