Information Sharing and Financial Market Regulation: Understanding the Capability Gap

Djoko Sigit Sayogo, Theresa Pardo, and Peter Bloniarz
Oct. 22, 2012


6th International Conference on Theory and Practice of Electronic Governance (ICEGOV2012), Mon, 22 Oct 2012.

In testimony on April of 2012 before the House Financial Services Committee, U.S. Securities and Exchange Commission (SEC) Chairman, Mary Schapiro, stated that effective information sharing between financial market actors and their regulatory bodies is critical to fulfilling the regulatory obligations of the SEC. The 2008 financial crisis is recognized as a show case for the risks to the stability of the markets that ineffective information sharing among supervisory authorities represents. This paper constitutes a preliminary exploration of the challenges facing financial regulators building on prior research in the computing and information science community (CIS). Current literature as well as data from a recent study of financial market regulation is used to identify key actors in financial market regulation information sharing relationships and to begin to outline the challenges faced in this unique context and the resulting risk if those challenges go unaddressed. A recently developed theoretical framework for cross-boundary information sharing (Garcia et al 2007) is used to present insights about challenges and risks from the literature and the field.