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Securities and Exchange Commission Investor Advisory Committee Minutes of June 12, 2012 Meeting 1

The Investor Advisory Committee convened its inaugural meeting at 10:00 a.m. on June 12, 2012, in the multipurpose room of the Securities and Exchange Commission's headquarters in Washington, D.C. The meeting lasted until approximately 4:00 p.m. and was open to the public, except for an administrative lunch session. Those attending were:

Commissioners of the Securities and Exchange Commission
Chairman Mary Schapiro
Commissioner Luis Aguilar
Commissioner Daniel Gallagher
Commissioner Troy Paredes
Commissioner Elisse Walter

Advisory Committee Members
Darcy Bradbury
Joseph Dear
Eugene Duffy
Roger Ganser
James Glassman
Craig Goettsch
Joseph Grundfest
Mellody Hobson (by telephone)
Stephen Holmes
Adam Kanzer
Roy Katzovicz
Barbara Roper
Kurt Schacht
Alan Schnitzer
Jean Setzfand
Anne Sheehan
Damon Silvers
Mark Tresnowski
Steven Wallman
Ann Yerger (by telephone)

Staff of the Securities and Exchange Commission
Lori Schock
Owen Donley
David Fredrickson
Tom Kim
Mike McTiernan
Stephanie Hunsaker
Susan Nash
Hunter Jones
Lourdes Gonzalez
Ted Venuti


Ms. Schock opened the meeting. Chairman Schapiro and Commissioners Walter, Aguilar, Paredes, and Gallagher welcomed the Committee.


Each member introduced themselves, including introductory discussion of issues the member thought the Investor Advisory Committee might consider.


Draft Charter

The Committee discussed the draft charter. These discussions included: (i) the Committee amending the draft charter at Section 11 so that the first sentence reads, "The Committee may form subcommittees or subgroups as it deems appropriate by a majority vote after notice to Commission staff"; and (ii) also in that section, the Committee added, "Any subcommittee may create written product for consideration by the Committee."

The Committee also discussed clarifying subcommittee authority; the two-week meeting notice period; and limits on topics the Committee should consider (such as enforcement matters, ethics, and internal Commission operations). The Committee rejected voting on matters via e-mail.


Draft By-Laws

The Committee reviewed and compared the draft by-laws to the draft charter. Discussion included: confirming that subcommittees would not operate in public; agreement that all issues raised to the Chairman would be considered at the next meeting; voting; and suggestions to adopt Robert's Rules of Order.

The Committee amended the by-laws at Subsection B. The sentence, "The Chairman of the Committee through Commission staff will give each member of the Committee written notice of each meeting not later than two weeks before the date of the meeting" was added.

Paragraph I was amended to read:

The Secretary or Assistant Secretary will prepare minutes of each meeting of the Committee and circulate the minutes to all members for review and comment. The Secretary or Assistant Secretary will distribute copies of the minutes to each member in advance of the following Committee meeting at which a vote will be held to approve the minutes.

Paragraph J was amended to state, "No subcommittee will have any authority to provide advice or recommendations (1) directly to the Commission or any agency official, or (2) to be adopted by the Committee without approval at an open meeting of the Committee." Paragraph J was also amended to add, "The subcommittee chair will provide the entire Committee reasonable notice of subcommittee meetings."

Paragraph K was amended to read "Robert's Rules of Order will apply to Committee meetings except as otherwise provided for in the Committee's by-laws and charter."


Following discussion, the Committee elected Joseph Dear as Chairman. He was the only nominee. Members of the Committee nominated Mr. Goettsch and Mr. Schacht to be Vice Chairman. The Committee elected Mr. Goettsch. The Committee elected J. Robert Brown, Jr. (who was absent) Secretary. He was the only nominee. The Committee elected Jean Setzfand, the only nominee, Assistant Secretary.


Tom Kim of the Division of Corporation Finance gave a presentation on the JOBS Act. Mike McTiernan and Stephanie Husker of the Division of Corporation Finance gave a presentation on the disclosure operation work of the Division and the use of a strategic risk based approach to disclosure review. Susan Nash of the Division of Investment Management provided a presentation on Commission initiatives on target date retirement funds. Hunter Jones of the Division of Investment Management discussed identity theft red flags. Lourdes Gonzalez of the Division of Trading and Markets discussed broker-dealer business conduct issues. Ted Venuti of the Division of Trading and Markets discussed equity market structures and related regulatory initiatives.


The Chairman elicited ideas from members on subcommittees. The Committee created four subcommittees: market structure; investor education; investor as purchaser; and investor as owner. Committee officers agreed to solicit members for each of the four subcommittees. The Committee decided that the officers would make a recommendation to the Committee regarding a subcommittee for the JOBS Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act after consulting with Commission staff. The officers agreed to circulate dates for the next meeting.

2 For purposes of these minutes, descriptions of discussions have been grouped and listed seriatim, even though the discussions of different items overlapped on occasion.



Modified: 10/05/2012