Washington INsider

Washington INsiderblog

Mark Schoeff Jr. looks at what's really happening on Capitol Hill - and the upshot for advisers.

Schapiro begins to shape legacy narrative

In Washington speech, she cites saving SEC from extinction

By Mark Schoeff Jr.

Oct 26, 2012 @ 3:20 pm (Updated 5:44 pm) EST

Mary Schapiro
Securities and Exchange Commission Chairman Mary Schapiro is beginning to tout her legacy. (Photo: Bloomberg News)

The assumption that Securities and Exchange Commission Chairman Mary Schapiro is leaving her post after the election regardless of who wins the White House is so widely held that it's coming up casually in Q&A sessions when she appears at Washington events.

After a speech on Friday at a forum sponsored by her alma mater, the George Washington University School of Law, Ms. Schapiro gracefully sidestepped an assertion by an audience member that she is nearing the end of her SEC service. Instead, she focused on the heart of his question, which was about SEC funding.

She didn't disagree with him that the SEC is operating on a budget – about $1.3 billion – that is miniscule compared to the size of the financial-market behemoths it must oversee. But she said that she continues to “fight like crazy for funding” from Congress.

Over the last couple of years, Ms. Schapiro has been more successful than most federal agency leaders – securing consistent, albeit small, gains for the SEC. Her relative effectiveness on the budget front is one of several positive points about her tenure that Ms. Schapiro may emphasize over the next few weeks or months as she heads toward the exit.

Ms. Schapiro was in legacy-shaping mode in her George Washington appearance. She noted that when she was appointed SEC chairman in January 2009 in the midst of the financial crisis, the SEC was under attack. Some critics were calling for it to be abolished and its functions split up among other agencies.

“So when the financial reform legislation was being drafted I took a particularly active role in advocating for the importance of the SEC's mission,” Ms. Schapiro said. “In the process, I worked with those on the Hill and in the administration to ensure the SEC would have its authority bolstered, not weakened – and I am pleased that occurred. It was a sign that Congress appreciated the need for a strong SEC.”

Half of that Congress – the House – was subsequently taken over by Republicans. The GOP has been relentless but respectful in hauling Ms. Schapiro up to congressional hearings to criticize how the SEC is implementing the Dodd-Frank financial reform law.

On the Hill, she usually highlights SEC advances under her leadership. They include streamlining and restructuring the enforcement division, upgrading the agency's technology, establishing a risk and economic analysis division, stepping up cross-agency collaboration and bringing a record number of enforcement actions in fiscal year 2011.

Ms. Schapiro also takes pride in the SEC's increased oversight of hedge funds and private equity funds and the enhanced disclosure it now requires on conflict minerals.

Of course, she was dealt significant setbacks, such as her failure to secure the three commission votes out of five necessary for the SEC to propose a money-market-fund-reform rule. In addition, a rule to impose a uniform fiduciary-duty standard for retail investment advice, a priority of Ms. Schapiro's, has yet to be proposed nearly 2.5 years after Dodd-Frank was signed into law.

There are plenty of stories chronicling Ms. Schapiro's missteps and disappointments. In the next few weeks, she might try to add to that narrative by touting her accomplishments.

  @IN Wire

Apr 23 03:22PM
RT @BDNEWSGUY: Great data by the team here at IN via @newsfromIN The 10 fastest-growing independent broker-dealers http://t.co/LKLGqewpcZ
Apr 23 03:20PM
The 'old, pale male' problem: InvestmentNews panel digs into ways the advisory business can break its image http://t.co/Qha7XvhxS4

Career Center

Explore your opportunities and be informed for your next move.

Company Type
Firm Type
Clearing Firm
Presented by

Most Watched Video

7:12The 2 biggest factors driving growth in active ETFs

Ugo W. Egbunike Dir. Of Business Development, ETF.com Greg Crawford Deputy Editor, InvestmentNews

Video Spotlight
1:47People are Living Longer. Good News or Bad News?

Sponsored by Oppenheimer Funds Inc.