The Securities and Exchange Commission is examining potential new rules for the municipal-securities market, said Chairman Mary Schapiro to the Wall Street Journal.
Schapiro said that new rules could be proposed as soon as July. The SEC has found several cases of lax practices or wrongdoing connected with the finances of state and local governments.
Last month, the SEC filed civil charges against Hank Morris, a political adviser, alleging that he extracted improper fees in exchange for helping secure business from New York state’s public pension fund. New York Attorney General Andrew Cuomo filed an indictment. The probe is also looking into private-equity firm Quandrangle Group, founded by Steven Rattner, who is President Barack Obama’s car czar.
One suggestion under consideration would prohibit an investment adviser from managing funds for two years if that adviser made donations to elected political officials.