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Challenges Confronting the Financial Services Industry
Mission
The U.S. capital markets have experienced significant change over the past decade, particularly with the dramatic increase in the use of derivatives, hedge funds, and other new alternative investment vehicles and products. Meanwhile, the principal statutory framework governing the regulation and oversight of financial services industry was developed more than 70 years ago and has only experienced relatively modest and piecemeal modifications over the years, usually in response to a particular crisis or series of crises. With this backdrop, coupled with growing competition from increasingly sophisticated foreign markets, this Working Group is considering the following:
- Whether and the extent to which there is need for changes in the current regulatory structure and scheme to better address the impact of the developments in the U.S. capital markets over the past decade, including whether federal primacy should be modified or expanded and the extent to which federal regulators (in particular, the SEC) can better assert federal primacy.
- Whether securities regulators should place greater focus on the integrity of marketplace systems (i.e., address systemic risks), without compromising investor protection responsibilities.
- The potential for greater communication among federal and state regulators and law enforcement agencies.
- Increase resources to issue guidance – consider how regulators can focus on identifying issues and preventing future problems by allocating greater resources to proactive and cooperative regulation.
- The current governance structure and future role of self-regulatory organizations/exchanges.
Working Group Members
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