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Text of Statement on the Regulation of Money Market Funds by SEC Commissioners Daniel M. Gallagher and Troy A. Paredes, on August 28, 2012

"We were dismayed by the Chairman's August 22, 2012, statement on the proposal she advanced to restructure money market funds. The current discourse about the Commission's regulation of money market funds is rife with misunderstandings and misconceptions. This joint statement is intended as one step in setting the record straight."

Statement by Commissioner Gallagher on SEC Proposed Rules for Money Market Funds

"Floating the NAV should better inform investors about the risks associated with investing in MMFs and will enhance the transparency of these products, thus reducing the incentive to run. But the only way to ensure that a run is stopped in its tracks is to permit gating.... [T]he combination of floating NAV and gating, which is one of the regulatory options we are proposing today, is the most robust plan for strengthening these important investment products."

SEC Proposes Controversial Rule Requiring Companies to Adopt No-Fault Clawback Policies

"One criticism of the proposal, such as that stated by dissenting Commissioner Daniel M. Gallagher, is that the rule places a strict liability standard on executives where Congress did not mandate one in the Dodd-Frank Act.... A second point of controversy is the definition of 'executive officers.'... According to Commissioner Gallagher and other critics, the rule's no-fault standard, coupled with the broad definition of who the rule applies to, 'creates the potential for substantial injustice' because 'the rule sweeps far more broadly than the group of individuals ultimately responsible for the financial reporting of the entire issuer."