In the last 48 hours, Eileen Rominger, the new director of the Division of Investment Management at the Securities and Exchange Commission, has appeared before a congressional committee and addressed an investment advice industry group.
That two-day time span represents more than 10% of her tenure, which began 17 days ago. Even as her profile is growing, she’s still sorting through her agenda and hasn’t yet decided how to proceed with rulemaking on 12(b)-1 fees.
“It’s premature of me to give you a good answer on that,” she told reporters following a Friday speech to the Investment Adviser Association compliance conference in Arlington, Va. “I’m in the process of taking inventory of important projects.”
Last summer, the SEC proposed a 12(b)-1 rule that would overhaul how mutual funds charge fees, causing an uproar in the industry. Since then, the agency has been overtaken by tasks associated with implementing the Dodd-Frank financial regulatory reform law.
Ms. Rominger steps into her leadership role at a time when the SEC is under deadline pressure to promulgate more than 100 Dodd-Frank rules and conduct about 20 studies arising from the law. Meanwhile, the dimensions of the commission’s core responsibilities of policing markets and protecting investors evolve almost daily.
That challenge is what drew her out of the financial industry, where she worked for nearly 30 years as an asset manager at OppenheimerFunds and The
Goldman Sachs Group Inc.
“The work that the SEC is doing right now is really important, and it’s occurring at a critical point in time when complexity in the market and the globalization of markets is occurring at a rapid rate,” Ms. Rominger said. “The investor protection mission of the SEC has never been more important.”
In her talk to the group of compliance officers, she warned that compliance concerns are sometimes overlooked when investment firms feel pressured to generate higher profits.
“Now, more than ever, it’s important to have good compliance,” Ms. Rominger said. “It’s not something that’s an overlay. It’s not once-a-year training. It’s who we are and what we do.”
Ms. Rominger’s SEC colleague, Carlo DiFlorio, director of the Office of Compliance Inspections and Examinations, said that her hiring is an example of how the agency is seeking to bring staff on board who have experience in the financial industry and understand the intricacies of today’s market.
Mr. DiFlorio credited SEC Chairman Mary Schapiro not only for changing the makeup of the agency’s personnel but also for restructuring the way they work together. She is implementing a system in which divisions cooperate more closely, which is a priority when implementing Dodd-Frank mandates that cut across the agency.
“She’s really changing the culture at the SEC with regard to teamwork,” Mr. DiFlorio said.
Mr. DiFlorio and Ms. Rominger made that case in an appearance before a House Financial Services subcommittee on Thursday, where they argued that the agency needs a funding increase to hire the staff and buy the information technology required to fulfill its regular duties and address Dodd-Frank.
Republicans on the committee questioned why the SEC should get a budget boost at a time when the country is facing a $1.6 trillion deficit. In addition, the GOP expressed skepticism about the agency’s performance leading up to the financial crisis of 2008.
Ms. Rominger said Friday she didn’t feel as though Republicans were ganging up on the agency.
“I thought the questions yesterday were good ones and constructive ones,” Ms. Rominger said.
