ICI Calls for New Super-Regulator
The Investment Company Institute has issued a white paper calling for a new “Capital Markets Regulator” combining the functions of the SEC and the CFTC to regulate all capital markets, market participants, and investment products. The new regulator should have explicit authority with respect to hedge funds, derivatives, and municipal securities and should harmonize regulation of investment advisers and broker-dealers. The white paper also calls for the creation of an inter-agency “Systemic Risk Regulator” to evaluate and monitor market risks. The white paper also calls for the consolidation of banking regulation and an optional federal charter for insurance companies. The ICI white paper bluntly argues that the “current system for oversight of U.S. financial institutions is insufficient.”
OUR TAKE: The ICI has a strong voice in the chorus calling for regulatory overhaul. We believe that the proposals outlined in the white paper will be (are being) seriously considered.