SEC Chair Gensler fires back at GOP critics

investmentnews.com:

Republican senators blasted a range of SEC rule proposals Tuesday — from mutual fund reform to a measure targeting advisor and broker conflicts when using artificial intelligence — while the agency’s leader assured them he is listening to critics.

During a Securities and Exchange Commission oversight hearing before the Senate Banking Committee, Chair Gary Gensler said the SEC has promulgated 22 final rules so far in his tenure, which began in April 2021. He said most were modified during the rulemaking process in response to comment letters.

“Nearly all of them have changed based on public feedback,” Gensler said.

That feedback is often like the grilling he received over the two hours of the banking panel hearing. GOP members of the committee — and some Democrats — zeroed in on what they don’t like about the dozens of proposals that remain on the SEC agenda.

Sen. Tim Scott, R-S.C., and the highest-ranking Republican on the committee, asserted that the SEC was exceeding its authority with a proposal to address advisor and broker conflicts of interest when using predictive data analytics — or artificial intelligence.

“Despite it being labeled a rule on artificial intelligence, your power grab to regulate emerging technologies, even Excel spreadsheets, is beyond the SEC’s scope and will ultimately stifle innovation,” said Scott, a Republican presidential candidate.

Sen. Mike Rounds, R-S.D., charged that the AI proposal demonstrated a “hostile” attitude toward innovation.

The lawmakers’ criticisms echoed those in a Tuesday letter to the SEC from 14 financial industry trade associations. The groups wrote that the SEC’s AI proposal “illustrates the Commission’s continued war on technology” and is “outright hostile to the use