About a year after retail traders turned the tables on institutional investors, targeting outsized short positions that sent GameStop Corp (NYSE:GME) shares soaring, former SEC commissioner Robert Jackson spoke about the underlying problem with Jon Stewart.
"To be fair to the SEC ... these are folks who are underfunded and undermanned," Jackson said Thursday on "The Problem With Jon Stewart Podcast," which is available on Apple Inc's (NASDAQ:AAPL) Apple TV+.
'They'll Sue You And Win': During the Trump administration, the SEC workforce declined by 5% while the stock market boomed, Jackson said. The regulator doesn't have enough money to hold people accountable, he added.
"The regulated entities, they have lawyers — good ones — and if you go outside the box, they'll sue you and win," Jackson said.
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During his time as commisioner, Jackson said the SEC attempted to make changes around transparency. A couple of days later, the NYSE CEO posted an article in the Wall Street Journal titled "Why We Are Suing The SEC," according to Jackson.
"We decided we wanted to make some changes," he said. "We made those changes into a rule and they took us to court and beat us."
The regulated finance industry has some really good lawyers and a lot of them used to work for the SEC, the former commissioner said.
Stewart responded, pointing out that the finance industry isn't very well regulated at all.
"The only difference between Wall Street and Las Vegas is Las Vegas is incredibly well regulated," Stewart said. "If you cheat there, they will f***ing throw you out."
Jackson Says SEC Needs Funding: Jackson told Stewart that in order to address the issues, there has to be something done in terms of the amount of money that the finance industry gives to Congress.
"The amount of money that's spent ... on these congressional races is so astonishing and completely nontransparent that what we end up with is a system where members of Congress don't want to fund the SEC to do its job."
Photo: alessandrodandrea from Pixabay.
