Section 5.1 - Q1 - What Does Project 2025 Say?

“With regulatory authority delegated by the government, both the Public Company Accounting Oversight Board (PCAOB) and FINRA have proved to be ineffective, costly, opaque, and largely impervious to reform. To reduce costs and improve transparency, due process, congressional oversight, and responsiveness, PCAOB and FINRA should be abolished, and their regulatory functions should be merged into the SEC.”

Citation: Project 2025, Section 5: Independent Regulatory Agencies, page 858, paragraph 1

Context:

The potential pros of shuttering FINRA and PCAOB include streamlining regulatory oversight, cost savings, increased accountability and transparency, and greater Congressional oversight.

Possible drawbacks include loss of specialized expertise, overburdening the SEC, regulatory gaps, and industry pushback. Many industry stakeholders may fear that a more centralized regulatory body could result in tougher regulations or a more rigid enforcement environment under the SEC compared to the relatively more flexible and specialized structures of FINRA and PCAOB.

The success of such a move would largely depend on how well the merger is managed and whether the SEC can effectively handle the expanded responsibilities.

Full contextual analysis of Section 5.1: Financial Regulatory Agencies here.

Section: Section 5.1: Financial Regulatory Agencies

Categories: Deregulation, The SEC