State regulators to feds: 'Don't marginalize us'

State securities regulators today warned federal policymakers not to enact regulatory reforms that might cut state powers.

“State securities regulators ... must not be pre-empted or marginalized as mere advisers to federal authorities,” the North American Securities Administrators Association Inc. of Washington said in a statement outlining its own principles for reform.

“Particularly in the areas of enforcement, licensing and compliance examinations, state regulators provide indispensable consumer protections,” NASAA said.

NASAA also called for the imposition of a fiduciary duty “on all securities professionals who dispense investment advice, including broker-dealers.”

Reform of the regulatory system is widely anticipated under the administration of President-elect Barack Obama.

Yesterday, Rahm Emanuel, the president-elect's chief of staff, told a group of corporate executives that reform of financial regulation would be a top priority for the new administration.

NASAA will host a regulatory-reform round table next month in Washington, D.C., at which state regulators will make specific recommendations for future reforms.

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