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Mary Schapiro Says The SEC Needs More Money, Bodies To Do Its Job

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$123 million and a just under 800 people should do the trick.

“This year finds the S.E.C. at an especially critical juncture in its history,” Schapiro said in written testimony prepared for the Senate Banking Committee’s panel on securities, insurance and investment. “Dodd-Frank will require significant additional resources or a substantial reduction in the performance of our core duties.” The law granted the S.E.C. broad new authority over credit rating agencies, the vast and complex derivatives markets and — for the first time — many hedge fund advisers. Among other mandates of the Dodd-Frank Act, the S.E.C. is supposed to write more than 100 new rules, open five new offices and publish more than 20 studies. Quite simply, Ms. Schapiro said, the law has “added significantly to the S.E.C.’s workload.”

Yet the agency’s budget remains frozen at $1.1 billion...The Obama administration has proposed raising the agency’s budget by $264 million, to $1.4 billion for 2012. The Dodd-Frank law requires the S.E.C. to offset its entire budget by collecting fees on securities transactions. That means the agency’s funding would not cost taxpayers a dime, Ms. Schapiro said. The administration’s proposed funding increase would allow the S.E.C. to hire 780 people, 60 percent of which would be assigned to Dodd-Frank mandates, according to her testimony. Ms. Schapiro said the agency needs more than 100 new staff members just to focus on hedge funds. The requested increase is “designed to provide the S.E.C. with the resources required to achieve several high-priority goals,” she said.

Mary Schapiro Makes Plea For More Funds [Dealbook]