PracticeAuditSEC set to recognise its counterparts overseas

SEC set to recognise its counterparts overseas

Watchdog conceeds overseas financial regulation is good enough for US markets

The US securities regulator is moving towards a proposal of mutual
recognition of foreign financial watchdogs, which will make it easier for non-US
markets and brokers to do business with US customers.

The plan is also set to allow foreign exchanges to place trading screens in
the US and permit brokers from outside the US to have a US customer base,
without necessarily registering their activities with the Securities and
Exchange Commission, as is currently required.

SEC chairman Christopher Cox, has asked agency staffers to form a task force
that will produce recommendations on mutual recognition of regulators – so that
even if those doing business in the US escape SEC oversight, they will still be
regulated by the SEC’s counterparts in their home-country, AP
reported.

SEC market regulation division director, Erik Sirri, told a senate committee
yesterday that the approach would be limited to countries with “very similar
philosophies and practices to ours,” in relation to concerns around fraud,
manipulation, insider trading, market surveillance, sales practice rules and
dispute resolution.

The SEC’s head of international affairs, Ethiopis Tafara, said that while the
changes could lower trading costs and encourage competition, it should not be
done in a way that would erode investor protections.

Further reading:

SEC
Pondering ‘Mutual Recognition’ Plan

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