Testimony of Gary Gensler
Before the United States House of Representatives Committee on Financial Services
Oct. 5, 2021
Having started at the SEC in the spring, I have been struck by the sheer breadth and scope of the operations of this great agency and remarkable staff. The SEC’s employees oversee 28,000 registered entities, more than 3,700 broker-dealers, 24 national securities exchanges, and seven clearing agencies. A record 67 million U.S. families held direct and indirect stock holdings in 2019.
As our capital markets have grown and technology continues to shape the face of finance, though, the SEC has not grown to meet the needs of the 2020s. At the end of fiscal year 2016, the SEC had 4,650 people on board. Nearly five years later, though, that number had decreased by about 4 percent.
In fiscal year 2020, the Division of Enforcement’s staff had 6 percent fewer staff on board than it did in fiscal year 2016. As another example, the SEC’s Division of Corporation Finance is currently 20 percent smaller than it was five years ago. Since 2016, the Division of Examinations’ total staff has remained relatively flat despite growth of more than 20 percent in the population of registered investment advisers and a 65 percent increase in the assets managed by these firms. Other divisions are similarly stretched thin.
Though I’m appreciative of the House’s decision to support a fiscal year 2022 budget of about $2 billion, this would get us back to only a headcount of 4,859. I’m hoping to continue to work with Congress to build back to where we were in 2016, but also to have the resources reflective of the growth and evolution of the capital markets.
As more Americans are accessing the capital markets, we need to be sure that the Commission has the resources to protect them.