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Aug 15

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Surprise! – U.S. Chamber of Commerce seeks more government control over SROs

A surprising call for additional government regulation occurs in a report entitled “The Unfinished Agenda”. The U.S. Chamber of Commerce states that Congress should have (but did not) alter the existing regulation of so-called self-regulatory organizations (SROs) as part of its recent changes in financial regulation passed through the Dodd-Frank Act.

The Chamber of Commerce fingers the Financial Industry Regulatory Authority (FINRA), Institutional Shareholder Services (ISS), the Financial Accounting Standards Board (FASB) and the Public Company Accounting Oversight Board (PCAOB).

The report includes:

A nongovernmental organization making determinations and judgments about the policies and practices of private enterprises should be required to provide meaningful and prompt opportunity to challenge or appeal. …

These organizations … fulfill many functions of government agencies and have either explicit or implicit delegated authority from government. Despite their tremendous influence over the workings of the capital markets, these organizations are generally subject to few or none of the traditional checks and balances that constrain government agencies. This means they are devoid of or substantially lack critical elements of governance and operational transparency, substantive and procedural standards for decision making, and meaningful due process mechanisms that allow market participants to object to their determinations.

…Certain core principles central to the operation and oversight of the U.S. capital markets should apply uniformly to government and nongovernmental policy makers alike, given their comparable roles and authorities over the marketplace.”

This article provides additional quotes and details.

About the author

David Nolte

I am a founding principal of Fulcrum Inquiry, an accounting and economic consulting firm that performs damage analysis for commercial litigation, forensic accountings, financial investigations, and business valuations. I am a Certified Public Accountant (CPA) and an Accredited Senior Appraiser (ASA), as well as having other professional credentials. I regularly serve as an expert witness involving damages measurement. My litigation-oriented resume is on Fulcrum's website.

Permanent link to this article: http://betweenthenumbers.net/2011/08/surprise-%e2%80%93-u-s-chamber-of-commerce-seeks-more-government-control-over-sros/

1 comment

  1. Arthur

    Great write, We are viewing back again persistently to hunt for fresh news.

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