H.R. 1062, the “SEC Regulatory Accountability Act” aims to make the Wall Street police much more friendly to Wall Street. The U.S. Securities and Exchange Commission (SEC) will have to take Wall Street’s financial interests into account when placing rules upon them; SEC will also have to explain themselves when they don’t take Wall Street’s rule-making suggestions.
People who make lots of money on Wall Street give lots of money to current members of Congress.
Section 2: Adds a section to the Securities Exchange Act of 1934
(e)(1) Before issuing a Wall Street regulation, the SEC must:
- State what problem the regulation will solve.
- Do a cost-benefit analysis on the real and financial effects of the regulation.
- Tell what other alternatives to regulation are available.
(e)(2) The cost-benefit analysis must include:
- The cost and benefits of not regulating at all.
- Whether the rule making will “promote efficiency, competition, and capital formation.”
- The regulation should be “tailored to impose the least burden on society, including market participants, individuals, businesses of differing sizes”… taking into account the cumulative costs of regulations.
- The impact of the regulation on “investor choice, market liquidity in the securities markets, and small businesses.”
(e)(3) The SEC must take comments from industry and explain why the SEC did not “incorporate those industry group concerns.”
(e)(4) Within a year of this bill passing and then every five years after, SEC must review all existing regulations.