Tauzin Issues Warning To SEC
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The chairman of the House Energy and Commerce Committee leveled a warning against the Securities and Exchange Commission's apparent trespass into the virtual world of financial portals.
In a letter to the SEC's acting chairman, Laura Unger, Rep. Billy Tauzin said the commission should not give the impression it was considering a move to regulate financial Internet portals.
The letter comes a month after a roundtable discussion in which SEC officials tried to determine the role of financial portals and the affect information presented on these sites had on day traders. The SEC would use the information presented by speakers to determine whether financial portals created a broker-dealer relationship, subject to regulation.
Tauzin's letter left no doubt about how he felt about any role the SEC would play on the Internet.
"The SEC has had a regrettable tradition of attempting to regulate in areas over which it lacked jurisdiction," Tauzin wrote. "Internet portals should not become part of this tradition"
A SEC spokesperson said the commission does not provide comment on Congressional correspondence.
Peter Sheffield, a spokesperson at the House, said Tauzin was concerned that a valuable resource would be lost if the SEC regulated financial portals.
"Congressman Tauzin feels these are passive Internet portals that provide useful, helpful enlightening information that makes for wiser investors," Sheffield said. "They're not providing advice, it's simply a mechanism for people to learn more about the capital markets."
Congressional officials said hearings into the SEC's actions are a possibility, but not planned at this time.