Cox Comments On Treasury Blueprint

by Mike Godfrey, for LawAndTax-News.com, Washington

01 April 2008

Securities and Exchange Commission Chairman Christopher Cox has spoken in response to the Blueprint for Financial Regulatory Reform proposed earlier in the week by the Treasury Department.

The Blueprint, which was published on Monday, presents a series of short-, intermediate- and long-term recommendations for reform of the US regulatory structure. The document also represents a key part of Treasury Secretary Henry M. Paulson Jr.'s efforts to improve the competitiveness of the US capital markets in the increasingly global marketplace.

Responding to the publication, Mr Cox issued the following statement:

"Recent events have provided further evidence, if more were needed, that financial services regulation in the United States needs to be better integrated among fewer agencies, with clearer lines of responsibility."

He continued: "Just as systemic risk cannot be neatly parceled along outdated regulatory lines, the overarching objective of investor protection can't be fully achieved if it fails to encompass derivatives, insurance, and new instruments that straddle today's regulatory divides."

"The proposed consolidation of responsibility for investor protection and the regulation of financial products deserves serious consideration as a way to better address the realities of today's markets."

Among other proposals, the Blueprint recommends creating a new federal commission for mortgage origination to protect consumers better. It also recommends modernizing the President's Working Group on Financial Markets and clarifying the Federal Reserve's liquidity provisioning, as Treasury Secretary Henry Paulson discussed recently.

"We should and can have a structure that is designed for the world we live in, one that is more flexible, one that can better adapt to change, one that will allow us to more effectively deal with inevitable market disruptions and one that will better protect investors and consumers," Secretary Paulson explained.

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