By THE ASSOCIATED PRESS
Published: June 27, 2007
WASHINGTON, June 26 (AP) — The chairman of the Securities and Exchange Commission on Tuesday defended the agency’s record in pursuing corporate misconduct, rebuffing accusations that it may be tilting toward business interests.
At the same time, the chairman, Christopher Cox, showed some understanding for Republican lawmakers’ complaints that class-action lawsuits against corporations had grown out of control.
“Regulation has costs. So does litigation,” Mr. Cox said at a hearing of the House Financial Services Committee, where he appeared with the other four commissioners. He said regulators must be “particularly attentive” to potential conflicts of interest on the part of those who sue companies.
Mr. Cox also disclosed that the agency had started about a dozen investigations related to complex aggregations of debt known as collateralized debt obligations, in which hedge funds have increasingly invested. The situation took on urgency last week with the near-collapse of two funds managed by the Wall Street investment firm Bear Stearns.