ABA Urges SEC to Withdraw, Revise Secondary Muni Market Disclosure Proposal

Expressing support for disclosure requirements for direct loans and purchases in the secondary municipal securities market, the American Bankers Association expressed concern today that the Securities and Exchange Commission’s proposal for disclosures is overbroad and excessively burdensome. The association urged the SEC to withdraw the proposal under Exchange Act Rule 15-C2-12 and revise it to be more targeted and practical.

For example, ABA argued, the definition of “financial obligation” is too broad, and the proposal includes no mechanism for redacting confidential information. ABA also said that the SEC has “grossly understated” the proposal’s burden, which would result in vast new amounts of filings that could overwhelm the EMMA reporting system and dilute the ability of investors to find useful information.