SEC Asks: Should Exchanges Operate As Regulators?

The U.S. Securities and Exchange Commission is in the midst of asking an interesting question: should for-profit exchanges operate as an industry regulator? Stock exchanges’ self-regulatory role was established well before the establishment of the SEC in 1934. The exchanges, non-profit entities at the time, derived special status from the regulatory role, such as the sale of lucrative market data and limits on private lawsuits against them, notes a report on the topic in Bloomberg Businessweek. The SEC is focusing on the exchanges’ regulation of competitors, with SEC Chairman Mary Jo White and Commissioner Daniel M. Gallagher have said the…