Market Regulation

Coalition Warns Against Securities Reg Rollbacks in Stimulus Legislation

As Congress takes up critically important COVID-relief/stimulus legislation, a coalition of state securities regulators, investor advocates, and leading securities law professors wrote to President Biden urging him to stand up against possible efforts to include rollbacks of securities laws as part of any stimulus measure.  The groups warned that “some in Congress have suggested that further measures to roll back our securities laws should be part of any upcoming economic stimulus bill. While the undersigned individuals and organizations may hold differing views on the appropriate regulation of public companies and the public markets,” they wrote, “we all strongly agree that further expanding the use of exempt offerings is unlikely to spur economically beneficial capital formation for investors or businesses. On the contrary, further expanding the pool of securities exempt from the disclosure and investor protections afforded by the federal securities laws has the potential to damage the economic recovery, including by increasing the probability of fraud and hindering the efficient allocation of capital.” The letter was sent to President Biden and to the Chairs of the Senate Banking Committee and House Financial Services Committee.