Commissioner Luis A. Aguilar Speech - Smart Regulation: Keeping the Door Open for Effective Ideas

In this statement, SEC Commissioner Luis A. Aguilar expressed disappointment in Rule 613 noting that "the rule as currently drafted will limit innovation, and will fail to achieve cost savings."

Rule 613 requires SROs to jointly submit a plan for developing and implementing a consolidated audit trail. The Commissioner suggested that the rule lacks sufficient prescriptive requirements and that the process of joint development by the SROs is flawed. More powerful SROs will have more influence resulting in "a battle of size, not necessarily one of ideas." Cost could be higher with only a single joint proposal available for consideration.

Alternatively, he suggest that each SRO independently develop its own plan for possible adoption by the SEC, noting that such a competition would bring to light better ideas and lower costs.

View speech in full here (links externally to SEC website).