WASHINGTON -- The chairman of the Securities and Exchange Commission yesterday defended the agency's record in pursuing corporate misconduct, rebuffing accusations that it may be tilting toward business interests.
At the same time, the government's top securities regulator showed some understanding for Republican lawmakers' complaints that class-action lawsuits against corporations have exploded out of control and their plea for the SEC to study their costs and benefits to ordinary individual investors.
"Regulation has costs, so does litigation," chairman Christopher Cox said at a hearing of the House Financial Services Committee, where he appeared with the other four SEC commissioners.
Cox also disclosed that the agency has started about a dozen investigations related to complex aggregations of debt known as collateralized debt obligations, in which hedge funds have increasingly invested.
Lawmakers advanced a number of concerns in lengthy questioning of the regulators.
Business interests have been pressing for an easing of corporate governance rules and restraints on class-action suits against corporations and auditors. On the other side, critics and investor advocates see recent moves by the SEC under Cox, a longtime free-market Republican congressman, as favoring business and Wall Street.