Week 5
Regulatory Agencies (Part 1) Instructions: Please follow the instructions below
Please read the following linked articles and websites, paying particular attention to what the authors say about “capture theory”:
Adam Thierer, “FAA and Commercial Drones Edition,” January 16, 2015, http://techliberation.com/2015/01/16/regulatory-capture-faa-and-commercial-drones-edition/ (Optional: for various scholarly viewpoints on “regulatory capture,” see also Adam Thierer, December 19, 2010, “Regulatory Capture: What the Experts have Found,” http://techliberation.com/2010/12/19/regulatory-capture-what-the-experts-have-found/) (FOR Question 2)
“BP and the Minerals Management Service: the Legacy of Capture Theory” June 2, 2010, http://www.nolanchart.com/article7752-bp-and-the-minerals-management-service-the-legacy-of-capture-theory-html (FOR Question 2)
Regulatory Agencies (Part 2)
Instructions: Please follow the instructions below.
The Securities and Exchange Commission (the SEC) is a regulatory agency in the United States Government that has existed since 1934 and that regulates the securities industries.
What is a security? A security is a stock, a bond, a promissory note, an option, a futures contract, etc.
Please read the following two links at the SEC’s website:
“What We Do,” Securities and Exchange (SEC) website, http://www.sec.gov/about/whatwedo.shtml (It’s a long web-page, so skimming is OK, but be sure you get a fair sense of what the SEC’s regulatory function is) (FOR Question 3&4)
The SEC provides a list of its litigation releases concerning civil lawsuits brought by the SEC at http://www.sec.gov/litigation/litreleases.shtml. Please choose a recent SEC litigation release from 2016, 2015 or 2014 and read it. (FOR Question 3&4)
QUESTIONS!!! (it doesn’t have to be long, just in your own words)
In your own words, please explain what “capture theory” is?
Please illustrate “capture theory” with two examples: (i) one of the examples should be from the readings link above, and (ii) the other example should be hypothetical (in other words, you’ve made up the example to illustrate the theory) or from the news. Examples (real or hypothetical) involving the FAA, the SEC and/or the FDA are fine.
Please (i) identify the SEC litigation action that you read about by litigation release number (for example, LR-23107), by date and by party; and (ii) in a few sentences, summarize the facts that the SEC is alleging and the action the SEC is taking.
Assuming that the facts the SEC alleges are correct in the SEC litigation action you read, do you agree with the SEC’s decision to take action against the defendants identified in the release? Was it the right decision? Why or why not?
Is the SEC litigation action that you discussed in Questions 3 & 4 consistent with a “capture theory” view of the SEC? Why or why not?
Please list at least three (3) things that the FDA regulates, and three (3) things that the FDA inspects.
In a few sentences, respond to the question whether you think the American public “needs” the FDA and/or the SEC? Why or why not? Make sure you consider capture theory in your response.