May 11, 2012
Schapiro on Money Market Fund Reform
SEC Chairman Mary Schapiro gave a speech at the Investment Company Institute's General Membership Meeting in which she reiterated her position that money market funds need additional regulation: We saw what happened in 2008." Her remarks (as reported in Investment News; the speech is not yet posted on the SEC website) suggested that she favors a floating NAV, but she says she wants to hear suggestions from the industry. The reforms put in place in 2010 were positive but not sufficient: "We can't sit by when we see systematic risks and not have a discussion about it." Inv News, Schapiro sticks to her guns on money funds
Meanwhile, three SEC Commissioners (Paredes, Gallagher, and Aguilar) released a statement in opposition to an IOSCO report exploring further regulation of the money market fund industry and seeking comments:
We feel that it is important to state for the record that the Consultation Report does not reflect the views and input of a majority of the Commission. In fact, a majority of the Commission expressed its unequivocal view that the Commission’s representatives should oppose publication of the Consultation Report and that the Commission’s representatives should urge IOSCO to withdraw it for further consideration and revision. Accordingly, the Consultation Report cannot be considered to represent the views of the U.S. Securities and Exchange Commission.
(Statement concerning publication by IOSCO on April 27, 2012 of the “Consultation Report of the IOSCO Standing Committee 5 on Money Market Funds: Money Market Fund Systemic Risk Analysis and Reform Options.”)
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