SEC Commissioner Sets Out Principles for Harmonization

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(Editor’s Note: The post below by Commission Aguilar is a transcript of his remarks at the Joint Meeting of the Securities and Exchange Commission and Commodity Futures Trading Commission last week.)

Good morning. I, too, would like to welcome the panelists and the members of the public present here, as well as those observing by webcast.

I am delighted to be here for these unprecedented meetings and I welcome these upcoming discussions.

As some of you know, I have been supportive of combining the SEC and the CFTC. Among other reasons, it would permit more comprehensive and coordinated oversight of financial markets that are increasingly interconnected, and would reduce the concerns and uncertainty about jurisdiction.

Although the SEC has many unique responsibilities, such as oversight of capital markets offerings and financial reporting, some market and intermediary oversight by the CFTC and SEC involve similar tasks. Holding these joint meetings can accomplish some of the same purposes as combining the agencies, and I believe it will result in improvements to our markets.

For example, harmonized rules could enable more consistent recordkeeping by regulated entities. And investors who seek to engage in both securities and futures transactions may be able to better manage their affairs and have their needs met more efficiently.

It is true that harmonization will not make sense in every case because of the different needs of market participants. As a result, as this process unfolds, it would make sense to consider harmonization consistent with some key principles. In particular, harmonization should be pursued where doing so would advance the public interest by enhancing investor protection, by providing a fair and competitive market structure that facilitates informed decision making, and where harmonization would further both agencies’ efforts in vigorous law enforcement. Investor protection is the animating purpose at the SEC, and it will help guide our work in this project.

And even where harmonization would not be appropriate, these meetings will assist our ongoing efforts to coordinate with one another.

My thanks to the staffs of both agencies for their work in organizing this two-day meeting. And thanks again to the panelists for agreeing to share their views with us, and to our respective Chairmen and my fellow Commissioners at the SEC and at the CFTC for agreeing to hold these meetings.

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