The Project On Government Oversight (POGO) is calling on the nation’s largest financial self-regulatory organization to make its Board meetings open to the public.
In a letter sent yesterday to the Chairman and CEO of the Financial Industry Regulatory Authority (FINRA)--a private self-regulatory organization that oversees and is funded by over 4,600 securities brokerage firms--POGO urged FINRA to make itself more open and accountable to its members, investors, and taxpayers.
"The lack of transparency and accountability at FINRA is absurd given its role in regulating brokerage firms," said POGO Executive Director Danielle Brian. "After the Wall Street collapse we simply can no longer allow the financial industry to regulate itself behind closed doors."
FINRA's members recently approved several proposals to reform FINRA, including a proposal to provide transcripts of Board meetings. But FINRA's Board rejected most of these proposals, and continues to conduct its meetings behind closed doors.
The Dodd-Frank financial reform law requires the Government Accountability Office and Securities and Exchange Commission to consider whether self-regulatory organizations such as FINRA should assist with the oversight of hedge funds and investment advisers. POGO wrote in its letter that it would be “foolhardy” to give an organization such as FINRA more authority without also requiring it to be more transparent and accountable.
Follow the link to view POGO's FINRA resource page, including POGO's previous letter to Congress raising concerns about FINRA's excessive executive compensation, its "incestuous relationship" with the securities industry, and its failure to regulate the misconduct of past members such as Bernie Madoff, Allen Stanford, Bear Stearns, and Lehman Brothers.