H.R.2689 - To amend the Securities Exchange Act of 1934 to transfer authorities and duties of registered national securities associations to the Securities and Exchange Commission. (119th Congress)
Summary
H.R.2689 proposes to amend the Securities Exchange Act of 1934 by transferring the authorities and duties of registered national securities associations to the Securities and Exchange Commission (SEC). This transfer would consolidate regulatory oversight of the securities industry under the SEC. The bill stipulates that any reference to a national securities association in existing laws or regulations would be deemed a reference to the SEC.
Expected Effects
If enacted, H.R.2689 would eliminate the role of national securities associations, such as FINRA, in regulating broker-dealers and enforcing securities laws. The SEC would assume direct responsibility for these functions. This could lead to changes in regulatory practices, enforcement priorities, and the overall structure of securities industry oversight.
Potential Benefits
- Streamlined Regulation: Consolidating authority within the SEC could lead to more efficient and consistent regulation of the securities industry.
- Increased Accountability: Direct SEC oversight might enhance accountability and transparency in enforcement actions.
- Reduced Duplication: Eliminating overlapping responsibilities between the SEC and national securities associations could reduce administrative costs.
- Uniform Standards: A single regulator could enforce more uniform standards across the industry, promoting fairness.
- Potential for Enhanced Expertise: The SEC may have greater resources and expertise compared to some national securities associations.
Potential Disadvantages
- Increased Bureaucracy: Expanding the SEC's responsibilities could lead to increased bureaucracy and slower response times.
- Potential for Overreach: Concentrating regulatory power in a single agency could increase the risk of regulatory overreach.
- Loss of Industry Expertise: National securities associations often possess specialized industry knowledge that the SEC may lack.
- Disruption and Uncertainty: The transition could create disruption and uncertainty within the securities industry.
- Reduced Competition: Eliminating national securities associations could reduce competition in the regulatory space.
Constitutional Alignment
The bill's constitutional alignment primarily concerns Article I, Section 1, which vests legislative powers in Congress. Congress has the power to regulate interstate commerce, which includes the securities industry. The transfer of regulatory authority from national securities associations to the SEC falls within this power. The bill does not appear to infringe upon any specific constitutional rights or limitations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).