GO
Loading...

Enter multiple symbols separated by commas

SEC Chairman Cox: Agency Has Better Tools In Place Than Ever Before

In an exclusive interview with CNBC, SEC Chairman Christopher Cox said that the agency is in its best shape ever to oversee a variety of regulatory issues simultaneously, whether it's options backdating or keeping a watchful eye on the derivatives market.

"I think we have better tools in place now then we've ever had before," Cox told CNBC's Erin Burnett. "We are constantly sharpening our spear in that respect."

He said the options backdating issue came to the attention of law enforcement because of collaborative work with academics and economists who noticed anomalies in the data. Options backdating occurs when options are issued retroactively to coincide with low points in a company's share price. This fattens profits for options recipients when they sell their shares at higher market prices.

"We jumped on that and the results are clear for everyone to see," Cox said. "We are applying those same techniques, looking around the corner and over the horizon on risk assessment in a number of areas."

He said the good news is that the SEC has issued guidance for companies on the options issue. "There is no way for people to accidentally to fall into (that) trap."

Meanwhile, Cox said that the SEC's recent proposal to increase the investment minimum for hedge funds would adjust the threshold for inflation since it was last set in 1982.

"What we're focusing now on and in the future is investable assets (or) money you've set aside for some investment purpose so we can be sure we are dealing with sophisticated investors," Cox said. "Hedge funds, after all, are risky investments. They tie up your money for some time. They are not transparent."

Regulators voted on a series of proposals on Wednesday that pushed forth several of Cox's initiatives, including: raising the investment minimums required to enter hedge funds; making it easier for companies to comply with certain regulations, and allowing companies to distribute more information electronically.

Contact U.S. News

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

  • Lottery ticket

    A thief who broke into the car of a Seattle couple left behind a million-dollar lottery ticket, NBC News reports.

  • The Lamborghini SpA Urus SUV.

    There's no shortage of luxury vehicle choices, but increasingly the wealthy are opting for high-end SUVs instead of traditional models.

  • Mike Trout #27 of the Los Angeles Angels takes a picture with fans before a game with Boston Red Sox at Fenway Park on May 23, 2015 in Boston, Massachusetts.

    MLB is using digital media initiatives like Snapchat and Web video to connect with younger viewers. Is it enough?

U.S. Video

  • Cramer: Here's the no. 1 play in cybersecurity

    Guarding Your Portfolio? "Mad Money" host Jim Cramer's got the number one pick for protection services in today's digital world.

  • Underestimate Cisco at own peril: Cramer

    Mad Money's Jim Cramer takes a look at the cybersecurity space to see if it could also protect your money.

  • Fly with LUV?

    While remaining profitable, Gary Kelly, Southwest Airlines chairman and CEO, tells Mad Money's Jim Cramer the company continues to focus on being a great airline and offering great customer service.