SEC Chair White Speaks on Protection of Retail Investors

In a speech before the Consumer Federation of America ("CFA"), SEC Chair Mary Jo White discussed the SEC's role in investor advocacy, and stressed the common goal the SEC and CFA share in their effort to protect retail investors in securities markets.

According to Chair White, the majority of American households today are involved in the securities markets through stock or other investment vehicles, noting that retail investment in 2014 remains focused on retirement and education. To protect these investors, Chair White highlighted the importance of the work of the SEC Office of Investor Education and Advocacy, which she stated works to educate retail investors about investment products and fraudulent investment schemes through frequent investor alerts and bulletins.

Chair White noted that another way the SEC protects retail investors is through its enforcement program, stating that the SEC is constantly looking for ways to strengthen its enforcement message such as the no admit/no deny settlement protocol. She also highlighted recent and upcoming rulemakings to protect investors, including:

• whether and how to impose a uniform fiduciary standard for broker-dealers and investment advisers when providing personalized investment advice about securities to retail customers;
• rules implementing the JOBS Act mandate to lift the ban on general solicitation for certain exempt offerings of securities;
• proposed rules to address concerns about investor understanding of the risks in target date funds, for which the SEC staff is developing a request for additional comment;
• whether and how to exercise Dodd-Frank Section 921 ("Authority to Restrict Mandatory Pre-Dispute Arbitration") authority to limit or eliminate mandatory pre-dispute arbitration agreements; and
• improvements to the public disclosure regime, which is not yet at the rulemaking stage.

See: Chair White's Speech.