SEC Investigating 'Sham Letters' That Favored Proxy Regs

By Tom Zanki (December 10, 2019, 5:49 PM EST) -- U.S. Securities and Exchange Commission chairman Jay Clayton said Tuesday that the agency is investigating letters he cited in support of a controversial proposal to increase regulation of proxy advisory firms — letters that have since been reported to be dubious.

Clayton told the Senate Banking Committee that the matter has been turned over to the SEC's general counsel and inspector general's office. Clayton was responding to questions by Sen. Tina Smith, D-Minn., who was concerned "sham letters" were informing the agency's thinking.

"We are having an investigation of this issue," Clayton said, declining to delve into specifics.

The matter stems...

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