The Securities and Exchange Commission is proposing some definitional changes to ease its regulatory flexibility. I didn’t think much of this, putting it into the compliance arcana bucket. That is, until I took a brief look at the changes on the Fact Sheet.
The SEC is proposing to increase the definition of a “small” investment adviser from $25 million in assets under management to …. $1 billion. [Move pinkie to mouth.] For investment companies, the definition is increased from $50 million to $10 billion.
The dollar thresholds have remained unchanged for over three decades, so an increase is warranted. To me, this seems like an order of magnitude too much.
The SEC is required to determine if a rulemaking is likely to have a “significant economic impact on a substantial number of small entities” under the Regulatory Flexibility Act. This seems to me that the SEC is lumping small and medium size firms together.
Sorry to be mashing together allusions to two different movies in one story.
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