SEC Close to New Investment Fund Liquidity Requirements

Posted September 22, 2016 at 10:30am

New rules are coming soon on mutual fund and asset management, covering liquidity, leverage and derivatives, according Securities and Exchange Commission Chairwoman Mary Jo White.

These upcoming rules will be what White called “an ambitious agenda to modernize and enhance our regulatory regime,” during a speech in Washington.

Without giving a specific date, White said she anticipates these will be finalized in the “near-term.”

The rulemaking will address liquidity risk management by mutual funds and exchange-traded funds, will require business continuity and transition planning by investment advisers, and will require new disclosure procedures.

White also defended the agency’s push for access to the records of foreign companies. “I cannot emphasize strongly enough how critical the records we seek and the examinations we conduct are to the SEC’s ability to assess firms’ compliance with U.S. law and to protect investors and the markets,” she said.

The agency has run into roadblocks because of foreign privacy laws, and those on bank and state secrecy, White noted. More work between international regulators is needed, she believes. “More than ever before, it is critical that jurisdictions break down their information-sharing walls. Regulators must be able to directly supervise the entities registered with them to ensure compliance with the laws in their jurisdiction,” she added. Her comments did not address any particular efforts, however.