House Capital Markets Subcommittee Leaders Send Letter to Gensler on Swing Pricing

House Financial Services Subcommittee on Capital Markets Chair Ann Wagner (R-MO) and Ranking Member Brad Sherman (D-CA) sent a letter to SEC Chair Gary Gensler noting issues they believe create an untenable path forward for the Commission’s swing pricing rule proposal. The letter takes issue with the SEC’s proposal of a “hard close” and the Commission’s mandate to impose swing pricing on all mutual funds. The letter highlights operational issues and cost concerns as well as noting the disparate impact between those holding shares directly with the funds versus those investing through a retirement plan. Additionally, the letter notes costs are “likely to approach billions of dollars” and be borne by “main street investors, who are most reliant on mutual funds to secure their financial futures.” The letter highlights more technical points raised by industry comment letters including implementation issues, system reconfiguration, and investor confusion. Representatives Wagner and Sherman urge the Commission to “carefully evaluate its next steps and ensure that any new rules are made with the best interest of all investors in mind.”

Click here to reach Subcommittee Chair Wagner and Ranking Member Sherman’s letter to SEC Chair Gensler.