Securities Regulation Daily Commissioner Piwowar announces exit plans
Monday, May 7, 2018

Commissioner Piwowar announces exit plans

By Lene Powell, J.D.

SEC Commissioner Michael Piwowar announced he plans to resign his position as of July 7, 2018, or earlier if a successor is sworn in. If not immediately replaced, Piwowar’s departure will leave the Commission with four commissioners.

Piwowar’s term officially expires June 5, but commissioners may serve up to 18 months beyond the expiration of their terms. Commissioner Kara Stein is currently serving past expiration, as her term was up in 2017. As such, replacements for Piwowar and Stein may be nominated as a pair.

"Make economic analysis great again." Piwowar, who is only the third SEC commissioner to hold a Ph.D. in economics, has consistently championed the importance of economic analysis in SEC rulemaking, examinations, enforcement, and litigation. He said he has seen "considerable improvements" in SEC rulemaking during his term thanks to the insights of SEC economists.

"I will leave office at the end of my term satisfied that we have "Made Economic Analysis Great Again," Piwowar said in a recent speech to federal judges.

He would like to see further improvements, including closer integration of economists in policymaking and formal guidance on the use of economic analysis in enforcement.

Chairman Jay Clayton lauded Piwowar’s service and said the commissioner’s focus had raised the involvement and rigor of economic analysis in matters ranging from rulemaking to enforcement.

Advocate for the "forgotten investor." Likening modern investors to William Graham Sumner’s Forgotten Man, "dragooned into someone else’s quixotic crusade," Piwowar believes that the SEC disclosure regime has been coopted for political purposes. Instead of protecting the investor, disclosure requirements "bury the shareholders in an avalanche of trivial information" that does not help investors make decisions. Piwowar has also questioned whether the accredited investor regime and civil monetary penalties for corporations help or hurt investors.

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