Conduit Bond Issuers Should Be Subject To Closer SEC Scrutiny, Commissioner Says

Among other changes required in the municipal marketplace, nongovernmental issuers of conduit bonds should be subject to closer oversight and scrutiny by the Securities and Exchange Commission, Commissioner Elisse Walter said Oct. 29.

Conduit bonds are bonds sold by municipal entities on behalf of third parties, usually nongovernment entities such as colleges, hospitals, and private companies.

The SEC member, in remarks to a lawyers’ gathering organized by the Los Angeles County Bar Association, said that such third parties should be subject to “mandated registration and disclosure as would be the case if they issued their securities directly without using municipal ...