Press Releases

Yesterday, the Subcommittee on Capital Markets, led by Chairman Ann Wagner (MO-02), examined the Securities Exchange Commission (SEC) and their recent actions to ensure transparency and accountability across the agency.

On Ensuring Integrity at the SEC:

Chairman French Hill (AR-02) said, "The SEC plays a critical role in ensuring America's capital markets remain the envy of the world. However, during the Biden Administration, many market participants raised concerns about the bureaucratic overreach of that Administration and particularly regulation by enforcement at the Commission. Accountability must be restored at the SEC by ensuring the Commission follows the proper notice and comment procedures, produces rigorous cost-benefit analyses, and reexamines its enforcement process. These actions will restore public confidence, create transparency, and increase stakeholder engagement."

Capital Markets Subcommittee Chairman Wagner said, “…. members of this committee have repeatedly warned that 30-day comment periods are inadequate for understanding and providing meaningful replies for proposals that are hundreds of pages in length sometimes. This is not just a partisan concern. In October of 2022, 12 Senate Democrats wrote to the commission warning that these compressed windows were undermining the democratic process.”

Task Force on Monetary Policy, Treasury Market Resilience, and Economic Prosperity Chairman Frank Lucas (OK-03) said, “Mr. Cohen, this Committee reported out my bipartisan bill last month that would establish a public company advisory committee within the SEC. That seems to align with the progress Chairman Atkins has already made increasing transparency with the Commission in seeking broad, industrial feedback on potential regulatory changes.”

On Concerns About SEC Overreach:

Digital Assets, Financial Technology and Artificial Intelligence Subcommittee Chairman Bryan Steil (WI-01) said, “Staff legal bulletin 14L really gave staff at the SEC massive authority to make a decision on what was having a broad societal impact. That's the language. And what we saw, is after the staff bulletin comes out, we see a dramatic increase in shareholder proposals going before the SEC. We see this whole drive of the liberal left trying to drive through policy agendas via publicly traded companies in the United States so they can't move through Congress because no sane elected individual would support a lot of the stuff that they were trying to force publicly traded companies to do.”

Rep. Marlin Stutzman (IN-03) said, “The SEC was created to protect investors, to maintain fair, orderly and efficient markets and facilitate capital formation, not to serve as a vehicle for advancing political or social priorities. However, under President Joe Biden and Chairman Gary Gensler, the SEC strayed beyond its statutory mandate and pushed forward a large and complex regulatory agenda. The result of this was higher compliance costs, reduced market competition, and fewer opportunities for businesses to raise capital. Much like our banking industry, our capital markets are among the most heavily regulated sectors in the world. Therefore, it's important that regulators carefully calibrate their actions to address market deficiencies without causing undue harm.”

The Witnesses Echoed the Work of the Committee:

Mr. Peter Chan, Partner, Baker McKenzie said, “The SEC should be focusing on getting rid of burdensome regulations that no longer make sense. Instead, the past Commission engaged at a breakneck pace to promulgate rules, resulting in unfair process and bad rules. Thankfully, Chairman Atkins is righting the ship and returning fairness to the Commission. He has issued key policy statements to reform enforcement. He has also launched initiatives to reduce unnecessary regulatory burdens. But it is difficult to correct the course of an aircraft carrier, and there is no guarantee that future leadership will not deviate from the path of fairness.” 

Mr. Alexander Cohen, Partner & Co-Chair of the National Office Latham & Watkins said, “The SEC’s recent approval of a reduced 2026 budget for the PCAOB – which notably includes a 52% and 42% reduction in the Chairperson and other Board members’ compensation – is a welcome step in the right direction. But Congress should go further. It should eliminate the status of the PCAOB as a private entity, and should instead make the PCAOB an office within the SEC, subject to full Congressional oversight.”

Mr. Chris Iacovella, President and Chief Executive Officer, American Securities Association said, “The Financial Services Committee has done remarkable work to raise awareness over the lack of Constitutional protections within the SEC administrative system and to highlight general concerns with the SEC’s overall approach towards enforcement. While two recent Supreme Court cases – Lucia vs. SEC and Jarkesy vs. SEC have curtailed the SEC’s abuse of its administrative tribunals, significant flaws still remain within the agency’s enforcement program.”