ms. crawford? >> good morning, mr. chairman, and members of the commission. i'm ms. crawford, president of the north american securities administrators. >> can you lean a little into that force, ms. crawford? >> sherpa guide to texas securities commission and m. president of the north american securities administrators association, also known as nassau. i am very honored to be here today. in thinking about the world that state enforcement authority it is instructive to examine the regulatory responses to the major financial scandals of the past decade. from exposing securities and complex and market timing and mutual funds, to the auction rate security cases, state securities regulators have consistently been in the lead and did, in some cases the time the states begin their investigation, it was unclear whether the federal regulars intended to pursue any investigation at all. the most recent example is what the auction rate securities, ars or millions of dollars of the these securities were sold to investors, by major broker houses as cash alternatives. in february o

ms. crawford? >> good morning mr. chairman and members of the commission. i and the president of the north american securities administration's tammet can you the in into that? >> and the taxes securities commissioner and president of the nasaa i am honored to be here today. it is instructive to examine the rate of the responses to the major scandals of the past decade. when exposing securities analyst conflict and mutual funds to the auction rate securities cases, state securities regulators have consistently been in the lead. indeed, in some cases the time the states began investigations it was unclear whether federal regulators intended to pursue any investigation at all. the most recent example is the option rate securities spread out billions of these dollars were sold to investors with major brokerage houses and did february 2000 market collapse. investors were left with illiquid securities. and june of that year regulators brought a similar action charging for the firm with false representation. a month later there was a suit against ubs and july a s

ms. murren? >> thank you, mr. chairman. i have a question for commissioner crawford. if you could talk a little bit about what he believed there were any specific actions that might have been taken over the course of the last several years that would have led to a diminishment and what you characterize as being regulatory capture. >> yes, i do. i think that it is a problem that when you go to work for federal agencies, particularly the sec, thereti whatsoeve the u can immediately leave and go represent wall street firms, work on wall street. and what i think that that does is it tends to have a chilling effect on the zeal with which you regulate those people across the table from you. in addition, i think that there are some systemic issues that need to be looked at by all the federal regulatory agencies. one of the problems with washington, and you hear this over and over again, is that they are too removed on what's happening on a day-to-day basis. and it makes a big difference if you are a regulator and somebody literally walks in off the street and sits down and g