What`s The Right Level of Regulation?
Is the right level of regulation even the right question? Shouldn’t regulators look at how compliance can be achieved, and whether tech can play a role in highly effective, low-cost compliance?
“Nearly six years after passage of the Dodd-Frank, it is amazing how little has been achieved in figuring out the correct balance in financial regulation — one that keeps institutions in check without undermining their ability to do business,” he writes.
He looks at politics and the often inevitable expansion of regulatory authority and suggests that while it now seems to concern the major banks, it is apt to trickle down to other financial intermediaries.
“Over extended periods, poorly thought-out regulation can contribute to a financial crisis just as easily as smart regulation can avert one.”
Missing from the commentary is any look at how technology can help financial firms meet regulatory requirements, or whether regulations could be designed with an eye to making them amenable to technical solutions. Discussions of regulation in finance shouldn’t omit the potential value of RegTech solutions.
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