Consumer advocacy groups and Maryland Securities Commissioner Melanie Lubin say the current Republican proposal to overhaul the Dodd-Frank reform will tie the hands of regulators and hurt investors, Financial Advisor writes.
Several opponents of the Financial Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs (CHOICE) Act criticized the bill at a House Financial Services Committee hearing last Friday, according to the publication. Lubin slammed the bill for doing away with the Department of Labor’s fiduciary rule, which purports to require brokers to put clients’ interest first, Financial Advisor writes.
She also attacked the bill for allowing unsophisticated investors to participate in private offerings and for its requirement that regulators coordinate enforcement efforts, which she says will hamper state securities regulators.
Massachusetts’ Secretary of the Commonwealth William Galvin also took issue with the CHOICE Act’s “language” revoking the Labor Department’s fiduciary rule in a letter to House Financial Services Committee chairman Jeb Hensarling last week.
The CHOICE Act would also let more violators escape sanctions because it would allow offenders to avoid SEC administrative enforcement by taking cases to the courts, according to Columbia University Law professor John Coffee, a top academic expert for the Financial Services Committee Democrats, Financial Advisor writes. Other opponents speaking Friday included Ken Bertsch, executive director of the Council of Institutional Investors, and Consumer Federation of America fellow Rohit Chopra, according to the publication.
The CHOICE Act is expected to sail through a Republican-controlled House but may hang up in the Senate, Financial Advisor writes. Senate Banking Committee chair Mike Crapo has said he prefers a bipartisan revamp of the Dodd-Frank Act rather than an outright repeal, according to the publication.