At Pomerantz Lecture, Former SEC Commissioner Kara M. Stein Explores Investor Protection in the Digital Age

Kara M. Stein, Former Commissioner, U.S. Securities and Exchange Commission (SEC), delivered the Abraham L. Pomerantz Lecture at Brooklyn Law School Sept. 24, speaking on the topic Investor Protection in the Digital Age. Professor James Fanto, Co-Director of Center for the Study of Business Law and Regulation, and Professor Roberta Karmel, former SEC commissioner and co-director of the Dennis J. Block Center for the Study of International Business Law, facilitated the post-lecture discussion. This was the 17th Pomerantz Lecture, which honors the life and work of Abraham L. Pomerantz ’24, who pioneered shareholder suits against major corporations, particularly derivative suits. The lecture is sponsored by the Center for the Study of Business Law and Regulation and the Brooklyn Law Review.

Historically, the SEC’s mission has been to protect investors; ensure fair, orderly, and efficient markets; and facilitate capital formation. However, Stein said, increasingly the agency is challenged by new technologies, innovative investment products, and computers trading securities instantaneously without human intervention. She explored the many questions those challenges raise. For example, does the regulatory paradigm created at the beginning of the 20th century still work for cryptoassets, distributed ledger technology, and dark pools? And what changes need to be made to help the agency perform its critical mission in the Digital Age?

“Market manipulation and fraud do not disappear,” said Stein. “New forms of manipulation require us to adapt to the environment.” These same technologies that make fraud easier, Stein suggested, should be employed by the SEC in order to combat it, with care and human oversight. Investors, she said, need “trust and information. If either of these are missing, the markets freeze up.”

The Pomerantz Lecture series focuses on topics of corporate securities law and related issues of professional responsibility. The law firm of Pomerantz LLP, of which Abraham Pomerantz was the founding partner, provides continuing support for the series.

View photos of the event here.