William Galvin blasts House Financial CHOICE Act

Massachusetts regulator calls the pending legislation 'a gift to the investment industry and Wall Street special interests.'

In a letter to members of the House Financial Services Committee, the chief securities regulator for Massachusetts warned that the House Financial CHOICE Act of 2017 would “leave their own constituents at the risk of fraud and financial abuse.”

William F. Galvin, secretary of the Commonwealth, called the pending legislation “a gift to the investment industry and Wall Street special interests.”

In particular, Mr. Galvin objected to a provision of the bill forcing federal and state regulators to coordinate enforcement actions.

“Maintaining the independent authority of the states is especially important in light of language in the act that has the effect of reducing the SEC’s enforcement powers,” he wrote, noting that provisions that mandate state and federal enforcement coordination “are just thinly-veiled attempts to similarly tie the hands of the states.”

Many provisions of the bill will reduce transparency, expose retail investors to unjustified risks, and promote conflicts of interest that will harm retail investors, he wrote.