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What Will Be The SEC's Priorities Under Gary Gensler?

What Will Be The SEC's Priorities Under Gary Gensler?

What Will Be The SEC's Priorities Under Gary Gensler?

The U.S. Senate this week confirmed Gary Gensler as the next Chair of the Securities and Exchange Commission, the agency charged with regulating the nation's financial markets.

The best way to know what to expect - in terms of possible policy changes - when an agency gets a new chief is to review their recent commentary - especially testimony from their confirmation hearings.

Looking at Gensler's remarks before the Senate Banking Committee in early March, when he made his pitch for confirmation as head of the financial market's watchdog, shows there will be a focus on taking punitive actions against bad actors, putting novel financial instruments and technology under closer scrutiny, with the overall goal of protecting everyday investors.

"When we take our eyes off the ball—when we fail to root out wrongdoing, or to adapt to new technologies, or to really understand novel financial instruments—things can go very wrong," Gensler warned in his written testimony.

Specifically he highlighted:

  • Transparency and accountability in financial markets to deter fraud and manipulation.
  • Promoting efficiency and competition to bring down costs and increase returns to investors.
  • Ensuring companies, both large corporates and startups, can raise capital.
  • Making sure financial markets are also serving the needs of working families.

Financial inclusion and expanding economic opportunity was the central theme of Gensler's testimony, with the former CFTC chair arguing that capital markets are key to providing that opportunity.

This includes non-traditional institutions, which have taken up a much larger role in providing financing to Americans, and Gensler said the SEC's regulations will have to keep up with new technology and the changing market landscape.

"I believe financial technology can be a powerful force for good—but only if we continue to harness the core values of the SEC in service of investors, issuers, and the public," he said.

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