Jun 14 2011
U.S. Senator Richard Shelby, ranking Republican on the Senate Committee on Banking, Housing and Urban Affairs, today made the following statement at a Committee hearing on the SEC and SIPC nominations.
STATEMENT OF SENATOR RICHARD C. SHELBY
Committee on Banking, Housing and Urban Affairs
June 14, 2011
“Thank you, Mr. Chairman.
“Today, the Committee will consider four nominations: two for the Securities and Exchange Commission and two for the Securities Investor Protection Corporation. Both organizations have played an important role in the aftermath of the financial crisis and will continue to do so.
“The Dodd-Frank Act gave the Securities and Exchange Commission a long list of rules to promulgate. In addition, the SEC is contemplating other major rulemakings. The SEC also recently restructured its enforcement and compliance programs to address some of the systemic problems that enabled Bernie Madoff and Allen Stanford to defraud thousands of investors for years without being caught. These initiatives, along with the important day-to-day business of the SEC, will continue to have significant effects on our economy for years to come.
“Therefore, it is important that the Commission use economic analysis to understand not only the costs of particular regulations, but also the cumulative effect that all of its rulemaking is having on the markets and the economy. At this critical time, the SEC should do everything it can to ease the regulatory burden it imposes on American businesses while remaining a credible deterrent to misconduct in the markets.
“With respect to the Securities Investor Protection Corporation or SIPC, the Madoff and Stanford frauds have put a spotlight on its responsibility for assisting customers of failed brokerage firms. The Madoff liquidation has been at the heart of SIPC’s work over the past several years and is much bigger than anything SIPC has dealt with in its four decade history.
“As for the Stanford case, SIPC has taken the position that coverage under the Securities Investor Protection Act is not appropriate. The defrauded Stanford victims have asked the SEC to consider the propriety of that decision. The SEC’s delay in making a decision is harming investors who already were harmed by the SEC’s failure to prevent the Stanford fraud. It is my hope that the SEC will stop delaying and make a final decision as quickly as possible.
“Thank you, Mr. Chairman. I look forward to working with you to move these nominations through the process as quickly as possible.”