Given the tight one-year deadline, it comes as no surprise that the SEC, the CFTC and various industry trade associations are already talking about extensions to the fast approaching July 21st deadline to implement Dodd-Frank. On April 8th, the SEC released a statement saying that they are likely to extend the deadline for mid-sized investment advisors, those with $25 million to $100 AUM, to register with the SEC until the first quarter of 2012. Additionally, the SEC is also currently contemplating amending the requirement that previously exempt advisors currently falling under the private advisor exemption, or advisors who typically work with hedge fund and other private funds, also register with the SEC. This announcement comes on the heels 19 trade-associates, including the U.S. Chamber of Commerce, American Petroleum Institute and Business Roundtable, voicing their concerns to Congress that the July 21st deadline was not enough time for the SEC and the CFTC to “develop a transparent and orderly system that minimizes unintended consequences”. On this issue, however, the CFTC is not in total agreement and Chairman Gary Gensler came back and stated that he does not think Congress needs to push back the date as he feels the phases of implementation laid out are sufficient.
We have been following Dodd-Frank regularly on TheBullRun (see our special Dodd-Frank category) and although the discussions, the debates, and the theories have been going on for what feels like more than a year, I understand where the extension requests are coming from. A year was definitely ambitious considering there are so many moving parts to the Dodd-Frank reform. Why push the deadlines so quickly? I can understand the SEC’s and the CFTC’s eagerness to implement a solution to the epidemic that hit Wall Street but there’s no point in slapping on a band-aid only for it to fall off. It will be interesting to see, however, what the outcome will be. Will the extensions be instituted and will they be extended again? What are your thoughts?