The U.S. securities industry stands ready to help regulators devise the rules implementing financial reform, says John Taft, the incoming chairman of the Securities Industry and Financial Markets Association.

Speaking to SIFMA’s annual meeting on Monday, Taft, CEO of RBC Wealth Management U.S., said that the rulemaking required by the Dodd-Frank Act is a massive task, “the single largest delegation of rulemaking authority by Congress to regulators in modern history”.

And regulators can’t do it alone, he suggested. “Frankly, our biggest fear is that regulators will be overwhelmed by the assignment. Not because there aren’t good, smart people working there, but there simply aren’t enough of them,” he said. “And many of these agencies are being asked to take an oversight role that is outside of anything they’ve done in the past. There’s simply not a legacy of core competency around certain issues.”

“They need help. They know they need help. And believe it or not, they welcome it,” he added.

SIFMA supports reform, he said, provided that it balances “the creation of a safer, sounder, more secure financial system with the recognition that that system is critical to economic growth.”

“In order to achieve that balance, we need to help regulators write regulations that prevent the broad and deep contagion that infected the entire system two years ago, without inhibiting the ability of our financial institutions to promote economic growth,” he said. That was the intent of Dodd-Frank too, but whether it will work that way depends entirely on how legislative mandates get translated into regulations, he said.

Of those mandates, SIFMA is prioritizing: systemic risk, resolution authority, derivatives regulation, securitization, capital and liquidity requirements, the Volcker Rule, and the creation of a federal fiduciary standard that would apply uniformly to both investment advisors and broker/dealers.

IE