One of the most interesting things to come out of this conversational thread about the regulators (the SEC and FINRA) is the amount of fear advisors are expressing about speaking openly. There seems to be a belief that our regulatory authorities would respond vindictively to any criticism of their activities; that (to be specific) they would put the critics out of business or deliberately harass them. In this context, I remember that when Congressional investigators asked Harry Markopolos why he didn't take his considerable evidence about the Bernie Madoff Ponzi scheme to the NASD (now FINRA), he said that he feared for his life.
So I think before anything else happens, the SEC and FINRA should make it VERY clear, to Congress and the public, that it is willing to engage in constructive dialogue with the profession and public about how to do its job better. If the organizations are not only resistant to change, but actually pursue vendettas against those who talk about ways to improve their efficiency and effectiveness, then Congress and the White House should completely clean house and bring in a more transparent, flexible staff that is focused not on protecting their current procedures, but on protecting the public.
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