SEC must protect large, small investors

The SEC, he stressed must not only “maintain a fair, orderly and efficient market but facilitate capital formation” as well.

The importance of the SEC, he said has become more critical as the securities market becomes more sophisticated, noting that as more and more first-time investors turn to the markets to help secure their futures, pay for homes and send children to university, “the investor protection mission of the SEC becomes more compelling than ever.”

“The laws and rules that govern the securities derive from a simple and straightforward concept: all investors, whether large institutions or private individuals, should have access to basic facts about an investment prior to buying it and so long as they hold it,” he said.

To help support investor education, the SEC, he said, now offers the public a wealth of educational information on its redesigned web site, which was also launched.

He said one of the principal functions of the Commission as an independent regulatory body is to create and promote such conditions in the securities markets as to ensure the orderly growth and development of the capital market.

Other key functions of the commission include:

• Maintain surveillance over the securities market and ensuring open, fair and equitable dealings in securities;

• Register, authorise or regulate reporting issuers, self-regulatory organisations and market actors (including brokers, dealers, traders, investment advisers) to ensure that proper standards of conduct and professionalism are maintained in securities business; and

• Protect the integrity of the securities market against any abuse arising from the practice of insider trading.

The SEC, he said requires public companies to disclose meaningful financial and other information to the public which provides “a common pool of knowledge for all investors to use to judge for themselves whether to buy, sell or hold a particular security.”

But, “only through the steady flow of timely, comprehensive and accurate information can people make sound decisions. The result of this information flow is a more active, efficient and transparent capital market that facilitates the capital formation so important to our nation’s economy,” he said.

He said TT’s role in the development of the Pan-Caribbean Financial Centre is essentially that of facilitator and developer.

As facilitator, government will establish a comprehensive legal and regulatory framework as well as institutional infrastructure.

As developer, it will participate in the market under special circumstances including where the market is unable to meet particular social needs and where there are market imperfections or where there might be significant market risks.