Funding the Securities and Exchange Commission

By David E. Franasiak, Joel Oswald, Eric Robins and Rebecca Konst.

With the enactment of the Dodd-Frank Act in 2010, the responsibilities of the Securities and Exchange Commission (SEC) have grown. New or expanded areas of SEC regulatory authority include the regulation of securities-based swaps, increased corporate governance and disclosure requirements, registration of certain private funds, registration of municipal financial advisers and swap advisers, the Volcker Rule prohibitions, additional regulations for credit rating agencies, and securitization requirements. The SEC’s Fiscal Year 2015 budget request is $1.7 billion, an increase of 26 percent from the FY 2014 enacted amount of $1.35 billion. The SEC budget, which is appropriated to the SEC by Congress, is entirely funded through the collection of securities transaction (options and equity transaction) fees, known as Section 31 fees.  The Section 31 fee fluctuates, reflecting the combination of changes in dollar volume trading and the SEC funding levels as set by Congress through annual appropriations bills. 

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