2/20/09: Congressman Barney Frank appeared at the SEC at the invitation of NTEU Chapter 293 to speak to SEC employees on Thursday, February 19. His appearance was telecast to Headquarters and all of the regional offices at the agency. Congressman Frank spoke on a broad range of issues related to regulatory reform and fielded a number of questions from employees. He encouraged SEC employees to "hang in there" in the face of recent criticism from a number of quarters.
In his remarks, Frank reviewed his goals for regulatory reform, placing the current financial crisis into a broader historical context. The time has come, in his view, for the re-emergence of a more vigorous role for regulators in our nation's financial markets. He said that the government's primary goal in regulating should be to reassure investors that they can feel safe investing in the markets. "The right kind of regulation, which I hope we'll be doing later this year, is very pro-market."
Frank indicated that the first step for Congress would be to create a "systemic risk regulator," to identify major risks to the entire financial system -- a job which he believes will most likely fall to the Federal Reserve for institutional reasons. With respect to the SEC, Frank stated that he expected the agency to receive additional resources in the form of increased hiring and an expanded regulatory portfolio that will include additional responsibility for currently unregulated capital pools in the markets, such as hedge funds. He also stated that he expects to see additional funding for compensation of SEC employees. On this last point, he pointed out that SEC employees are "obviously not doing it for the dough." He indicated that any specific changes related to the SEC would likely happen in the latter part of this year, if not next year.
Congressman Frank is Chairman of the House Financial Services Committee, which oversees all components of the nation’s housing and financial services sectors, including banking, insurance, real estate, public and assisted housing, and securities. This important committee has oversight responsibility for the SEC and self-regulatory organizations that police the securities markets. He will play a key role in any regulatory reform legislation that is advanced in the coming year.
SEC employees who attended this event were uniformly upbeat afterwards. Chapter 293 has received numerous communications from SEC offices around the country expressing their positive views of Congressman Frank's speech. "I am extremely pleased that we were able to get Congressman Frank to take time from his busy schedule to speak directly to SEC employees at this critical time," remarked Chapter 293 President Greg Gilman, who introduced Congressman Frank. "I believe that we are extremely fortunate as regulators to have someone of his caliber heading the House Financial Services Committee at this point in our history."