Published January 13, 2015
The government's top securities regulator said Friday he wants to see more frequent financial reports filed by companies and faster prosecution of fraud and other violations.
In his first speech to a Wall Street audience, Harvey Pitt, chairman of the Securities and Exchange Commission, affirmed his commitment to free market principles and eased government regulation while also promising protection of investors.
``Public investors are the bedrock of our markets, and their interests are a critical touchstone for us when deciding whether regulatory action is necessary or desirable,'' Pitt said in the speech to members of the Securities Industry Association at its annual meeting.
While noting he believes in free markets and flexible regulations, Pitt said the government should ``provide an environment in which innovation and creativity are rewarded, competition can flourish, and where market participants can compete fiercely but fairly on a level playing field.''
Later, speaking to reporters, Pitt spelled out some of his goals: more frequent reporting by corporations to replace the current quarterly system and quicker enforcement action by the SEC against securities law violations rather than years after the alleged wrongdoing.
Investors have been unnerved by terrorism and the slumping economy but will return to the financial markets soon, the heads of the two biggest stock exchanges predicted Thursday.
``Markets are nervous. Investors are on the sidelines,'' Hardwick Simmons, chairman and chief executive of the Nasdaq Stock Market, told the Wall Street trade group.
Still, public confidence in the Bush administration's anti-terrorism campaign and the Federal Reserve's handling of interest rate policy should reassure investors, Simmons suggested.
Of the absent investors, he said, ``I think those people will be back.''
Several brokerage and investment firms that are members of the Wall Street trade group lost employees in the Sept. 11 attack on the World Trade Center. At the hardest-hit firm, Cantor Fitzgerald, 657 of the 1,000 or so employees were killed.
The market was shut for four trading days, the longest closure since the 1930s.
Security was beefed up and attendance was down at the association's gathering at a tony Florida resort.
Pitt, a prominent securities lawyer who was President Bush's nominee as SEC chairman, was confirmed by the Senate in August and a few weeks later plunged into the crisis that gripped Wall Street, meeting nearly round the clock with the heads of Nasdaq and the New York Stock Exchange and securities industry leaders. The SEC invoked its emergency powers for the first time ever to ease restrictions on companies' purchases of their own shares, as a way to shore up prices and bring stability.
Late last month, the SEC under Pitt laid out a new policy that gives companies credit for coming forward to report misconduct such as improper accounting, which could possibly accord them more lenient treatment in return. Pitt himself promised a gentler relationship with accountants, turning from the adversarial stance of his predecessor, Clinton appointee Arthur Levitt.
Pitt also has said he believes securities laws must be reviewed because many are obsolete and impose an unfair burden on Wall Street and other market participants.
Because the SEC had to deal with the disruption of trading caused by the terror attacks, work on that issue and others - such as reducing stock analysts' conflicts of interest - has been delayed.
Richard Grasso, the NYSE's chairman and chief executive, acknowledged Thursday in remarks to the group beamed by satellite that the near-term economic picture ``will not be pretty.''
But he cited the market's recovery in recent weeks, saying it reflected investors' positive judgment for the longer term.
A ``new enthusiasm'' has entered the market, Grasso said.
https://www.foxnews.com/story/sec-chief-wants-more-frequent-financial-reports