The SEC Office of the Investor Advocate is required to produce and deliver to Congress a report on its objectives for the subsequent fiscal year.  Just recently, the Investor Advocate released and delivered its report outlining the principal objectives for the fiscal year 2021.

The report expresses growing concern regarding the Securities and Exchange Commission’s efforts to “expand” the private markets and the potential unintended consequences of weakening the public markets, the ability of investors to cast votes efficiently and have their votes counted accurately, and to obtain advice without interference from company management.  The Investor Advocate also pledges to remain “vigilant” in reviewing policies relating to novel exchange-traded funds and broker conduct.  Specifically, with respect to the SEC’s disclosure effectiveness initiative, the Office will consider the utility of more prescriptive disclosures relating to human capital.  The Office will consider the “growing obsolescence of the current registration and reporting regime” as the SEC expands the exemptions from registration requirements.  As in prior years, the Office will continue to focus on developments in the ETF marketplace and, in particular, on concerns regarding non-transparent ETFs, leveraged and inverse ETFs, and related products that may pose a risk to retail investors.  The Office also will monitor the implementation of Regulation BI.  The Investor Advocate includes a special report on the impact on investors from COVID-19.

The report is available here.

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