April 26, 2017

Corp Fin: Will Bill Hinman Be the New Director?

We normally don’t comment on rumors, but we couldn’t ignore this WSJ article by Dave Michaels:

President Donald Trump’s choice to run the Securities and Exchange Commission is quietly assembling a cabinet of top staff members who spent their careers on Wall Street or advised companies on big deals, foreshadowing the Commission’s quick pivot toward a deregulatory agenda.

Aides to Jay Clayton, Mr. Trump’s pick as SEC Chairman, have interviewed or offered positions to people who would run the divisions that investigate wrongdoing and fraud, regulate public companies and oversee stock exchanges, according to people familiar with the matter. The group of expected hires includes William Hinman, a partner at Simpson & Thacher LLP, who is likely to run the SEC division that writes the rules for public company disclosures.

The full Senate is expected to vote on Mr. Clayton’s nomination as soon as early May.

The SEC’s six division directors have often come from Wall Street or from law firms that advise or defend financial companies. Mr. Hinman, who donated to Hillary Clinton’s presidential campaign, was the top American lawyer advising Alibaba Group Holding Ltd. on its $25 billion initial public offering, one of the biggest ever in U.S. markets. He began his career in New York before moving to Silicon Valley in 1994 and becoming a top legal adviser on tech IPOs.

A spokesman for Mr. Clayton declined to comment on any hiring efforts, saying the nominee “remains focused on the Senate confirmation.”

Financial Choice Act 2.0: CII Weighs In

A few days ago, CII delivered a letter to the House Financial Services Committee in advance of today’s hearing. Broc is quoted on pg. 14 based on an excerpt from this blog.

We’re posting memos about the Choice Act in our “Regulatory Reform” Practice Area

SEC & CFTC Merger: The Pipe Dream Continues?

Here’s the intro from this WSJ article by Andrew Ackerman:

Does the U.S. need two separate market cops in Washington? That question is generating a lot of discussion early in the Trump administration as U.S. policy makers consider ways to streamline the federal bureaucracy by potentially merging the Commodity Futures Trading Commission into the Securities and Exchange Commission.

To be sure, the idea of combining the scrappy CFTC with the much larger and more bureaucratic SEC remains politically contentious and is highly unlikely to ever materialize. It is an idea that has been kicking around Washington for decades—and remained an idea. But some policy heavyweights support it. They include former Federal Reserve Chairman Paul Volcker , the conservative Heritage Foundation and Barney Frank, the retired Democratic congressman from Massachusetts. Mr. Frank has said he regrets that his namesake regulatory-overhaul law, the 2010 Dodd-Frank Act, didn’t merge the two regulators. The fact that they operate separately is the “single largest structural defect in our regulatory system,” he said in a 2012 statement shortly before retiring.

If the government could start from scratch, it wouldn’t have two separate agencies, supporters of a merger say. Proponents also argue a merger would simplify the regulation of financial firms that must adhere to rules set by two separate entities. A bank, for instance, might be regulated by the SEC as a publicly traded company, a broker and an asset manager. The same bank might be subject to CFTC oversight as a futures commission merchant (the equivalent of a broker) and a swap dealer. (The SEC also regulates swap dealers, as it shares jurisdiction with the CFTC over swaps, but it only oversees a sliver of the market.)

Liz Dunshee