|To: Thomas M. who wrote (273)||11/5/2000 12:54:45 PM|
|From: Cynic 2005|| Read Replies (1) | Respond to of 309|
|I have long hated the Greenspud and co for acting so irresponsible in their jobs. Artur Levitt may be the head of toothless tiger. May be he was just a talker not a doer. But one thing he did recently makes me so happy that, if he is running for the Prez, I will take-up US citizenship and vote for him. And I am not kidding.|
Levitt's SEC Angers Auditors, Analysts
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By Sandra Sugawara
Washington Post Staff Writer
Sunday, November 5, 2000; Page E1
Lobbyists for Wall Street say there is a Democratic way and a Republican way to regulate the securities markets.
Securities and Exchange Commission Chairman Arthur Levitt Jr. embodies the Democratic way. He has fashioned himself as a populist, pro-consumer regulator. He has not hesitated to use regulatory authority if he believes it will help individual investors, even if it adds to the burden on industry, say Wall Street lobbyists.
Among the results is a new SEC regulation that bans publicly traded companies from selectively leaking market-moving information to favored analysts or big investors before the information is disclosed to the general public.
Many analysts, whose job it is to guide their big clients' investments, are furious with the newly enacted rule. One Wall Street official said, "under a Republican administration, there wouldn't have been" such action.
The SEC has promised to study the "selective disclosure" ban next year to see how it is working. It is unlikely that a Democratic chairman would undo the rule, unless major problems arose; some Wall Street analysts are privately hopeful that a Republican administration will give them some relief.
The accounting industry is similarly upset by their treatment by Levitt's SEC.
Under securities laws, publicly traded companies must file financial statements reviewed by independent auditors. Levitt was concerned that the Big Five accounting firms were losing their independence from their audit clients because of all the lucrative consulting work they were doing for them. So the SEC proposed over the summer that accounting firms be banned from doing consulting work for audit clients. The accounting industry's main trade group and three of the large firms – Arthur Andersen, Deloitte & Touche and KPMG – accused the SEC of overreaching.
Privately, some accountants, and their supporters in Congress, say a Republican SEC chairman would never attempt to enact such regulations. The SEC and three firms have been intensely negotiating over the proposed rule, trying to reach a compromise. ( Oh yeah? Whining, it is your turn, for a change - bozos!)
Indeed, Wall Street expects that a Republican SEC chairman would more closely reflect the philosophy of free-market advocates such as Sen. Phil Gramm (R-Tex.), the influential chairman of the Senate Banking Committee. Gramm worries that antiquated or unnecessary regulations could hamper the growth of the United States' stock markets and securities industry. If there is a Bush administration, lobbyists expect Gramm to play a leading role in the selection of a new SEC chairman.
In coming years, the SEC also is expected to face a host of issues created by globalization, the emergence of new trading and telecommunications technologies, and increasing competition among stock markets.
For instance, with major U.S. exchanges talking about linking up with foreign exchanges and with more U.S. investment banks doing global deals, the SEC must decide whether it wants to relax some of its trading and accounting rules to facilitate these transactions.
Likewise, with technology creating a host of new electronic competitors to traditional stock markets, the SEC must decide whether and how much to intercede to help investors find the best price for a specific stock.
These kinds of issues do not necessarily break along party lines, say lobbyists, although they expect Republicans to be more inclined to remove regulations and allow markets to respond.