New Proposed E-Delivery Rule Removes Consumer Choice

A new controversial proposed rule by the U.S. Securities and Exchange Commission (SEC) would seem to make the delivery of sensitive financial documents easier. Right now, the process requires paper delivery unless the recipient affirmatively declares otherwise. The problem with the proposed rule is that the delivery option should be the choice of the consumer to get those documents via electronic or postal delivery. This is a regulation that would impact investors right to choose how to access important financial documents.

Although the SEC’s justification for the change sounds reasonable, defaulting investors into a new process to receive information may cause more friction and create hurdles for Main Street investors. According to the SEC, “regulation E-Delivery would make information more readily accessible and useful for investors and others while preserving the ability to receive delivery in paper format on request.” The current system allows a consumer to make that choice, not government bureaucrats. The process that has been used for years seems more reasonable to part-time investors who are not overly focused on these investments.

For the average family investing who does not spend much time dealing with investments, they will have this change imposed on them without their input. Once you rely on the paper delivery of documents, one would think the burden should be on the provider to give the investor and opportunity to decide on how to get information. Having a dramatic change in how one gets information about investment imposed by bureaucrats appears very problematic.