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SEC's Jackson Delays Departure Date

Regulatory Agencies

Securities and Exchange Commissioner Robert Jackson, Jr. reportedly has had a change of heart about when he will leave the SEC. 

Jackson, representing one of the Democratic slots on the Commission, had planned to leave this fall to return to teaching at the New York University School of Law, where he is currently on leave, but now will stay on while a search for his replacement continues, according to a report in Bloomberg Law. 

Jackson’s term expired in June, but commissioners are permitted to stay on for an additional 18 months until a replacement is confirmed. He has been serving since January 2018, filling the open seat formerly held by Luis Aguilar, who departed in December 2015. 

“Although my Term here expired in June, I intend to continue to serve on the Commission rather than return to teaching for the Fall semester,” Jackson told Bloomberg in a statement. “I look forward to continuing to support the Commission’s critical efforts to protect the ordinary American investors who rely on our markets to build their families’ futures.”

Jackson was the lone Democrat on the Commission when the Regulation Best Interest package was under consideration, and cast the lone “no” vote on all four issues before the SEC, complaining that the package did not raise the standard for investment advice. 

“I hoped to join my colleagues in announcing that the Nation’s investor protection agency has left no doubt that, in America, investors come first. Sadly, I cannot say that,” Jackson stated, explaining that he believes the rules retain a “muddled standard” that exposes millions to the costs of conflicted advice and contending that SEC’s position “concludes that investment advisers are not true fiduciaries.”

Allison Lee was confirmed in June to fill the open Democratic seat that was vacated by former Commissioner Kara Stein, who left the agency at the beginning of 2019.

President Trump has not yet named a nominee to replace Jackson, but a Reuters report suggests that he is considering Georgetown University Law Center professor Urska Velikonja, who teaches securities law. Also reportedly under consideration is Jackson’s counsel Caroline Crenshaw, who has served with the Commissioner since 2018 and previously worked for Stein after joining the SEC in 2013. 

SEC Commissioners require Senate confirmation, and the process can take several months from the time a nominee is named.  

In general, to ensure the impartiality of the SEC, no more than three of the five commissioners may be from the same political party. The current makeup of the SEC includes Democrats Jackson and Lee, as well as Republicans Hester Peirce, Elad Roisman and Chairman Jay Clayton.

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