Joint CFTC-SEC panel will handle emerging regulatory issues

The first task for a new alliance of two market regulators is an investigation into possible factors last week that caused stocks to drop rapidly.

The Securities and Exchange Commission and the Commodity Futures Trading Commission announced Tuesday the formation of a joint panel that will provide recommendations for what happened May 6 along with examining emerging market issues. 

Next week, the Joint SEC-CFTC Advisory Committee on Emerging Regulatory Issues will examine preliminary results from the market free fall that sent stocks tumbling about 1,000 points last week. 

SEC Chairman Mary Schapiro and CFTC head Gary Gensler told a House panel today that the effort between their agencies has been "very collaborative" in the time before and since the market experienced an unusually large drop and quick recovery during trading last week. 

The joint panel will look at market structure issues that may have contributed to the volatility as well "as disparate trading conventions and rules across various markets," according to a release today. 

Overall, the committee's charter provides a broad scope for the panel to assess regulatory risks for investor and market participants while helping the SEC and CFTC work better together. 

Schapiro and Gensler will serve as co-chairs of the committee that will include academics, former financial executives and former regulators. Meetings will be public as the panel looks into the May 6 events and other issues. 

So far, the members include: Brooksley Born, former CFTC chair; Jack Brennan, former CEO and chairman of Vanguard; Robert Engle, finance professor at NYU's Stern School of Business; Richard Ketchum, chairman and CEO, FINRA; Maureen O'Hara, management and finance professor, Cornell University; Susan Phillips, dean and finance professor, The George Washington University School of Business; David Ruder, former SEC chair.