WASHINGTON, D.C.— On Thursday, March 2, the U.S. Securities and Exchange Commission’s (SEC) Investment Advisory Committee will hold a meeting on several key issues crucial to protecting investors and markets including swing pricing, the growth of private markets relative to public markets, and customer account statements. The Better Markets team has focused extensively on each of these issues and our resources can be found below.

Resources explained:

Panel Discussion Examining the Growth of Private Markets relative to the Public Markets: Drivers and Implications

• Better Markets Report: The SEC Must Stop Bleeding Public Markets Dry

Over the last several decades, Congress’s and the SEC’s steadily expanding exemptions from the registration requirements in the U.S. securities laws have shifted capital-raising activities between two parallel markets. One is an expanding private or exempt securities market that is dark, mostly unregulated, and accessible on a limited basis. The other is a shrinking public securities market that is transparent, well-regulated, and broadly accessible. The report and supporting fact sheet provide an overview of private markets’ present dominance over the public markets, which undermines investor protection, transparency, and liquidity.

Panel Discussion Regarding the Open-End Fund Liquidity Risk Management/Swing Pricing Rule Proposal

• Better Markets Comment Letter: SEC Proposal Would Promote The Stability Of Mutual Funds, While Raising Some Implementation Concerns

Better Markets filed a comment letter with the SEC in response to the agency’s proposed rule to strengthen liquidity risk management programs for open-end funds and implement swing pricing. In the letter we argue that the SEC should finalize the liquidity provisions without delay but take more time to consider alternative methods for ensuring that the costs and asset price changes arising from large numbers of purchases and redemptions are allocated fairly among investors.

Discussion of a Recommendation on Customer Account Statements

• Better Markets appearance at IAC Meeting: Legal Director Steve Hall Emphasizes Importance Of Disclosure In Account Statements

On December 8, 2022, Stephen Hall, Legal Director for Better Markets, participated in an SEC Investor Advisory Committee meeting panel discussion on Account Statement Disclosures, where he argued that account statements are vital tools for informing and protecting investors and that the SEC can and should do more to ensure that investors are getting the information they need through those documents. The IAC has issued a series of strong recommendations to help achieve that goal, and they align closely with Hall’s remarks.  They call for 1) more disclosure of fees and performance 2) in standardized formats 3) developed after studying the effectiveness of current disclosures 4) designed with the help of experts and 5) tested for efficacy. You can find the video of his remarks here:

###

Better Markets is a non-profit, non-partisan, and independent organization founded to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.