Publication: Reuters

Author: Alexandra Alper

07/19/2012 —If the Securities and Exchange Commission does not beef up its oversight of money market funds, a council of regulators should take the reins, former U.S. bank regulator Sheila Bair said on Thursday.

Bair, who formerly chaired the Federal Deposit Insurance Corp, applauded the reforms that SEC Chairman Mary Schapiro has floated to bolster the funds, four years after a fund “broke the buck,” letting its shares tumble before a dollar a piece and rattling markets.

But Bair, in a letter to regulators, said that if Schapiro cannot get the votes needed to push the rules through, the Financial Stability Oversight Council should step in.

“The risk that emergency government support may again be needed to stem large outflows from money market funds remains a serious challenge for U.S. and other markets,” Bair wrote, as chair of the Systemic Risk Council, a private group that monitors reform.

Read the full article, Sheila Bair urges prompt reforms for money market funds, on the Reuters website.