R Street urges Texas to adopt tough conflict of interest standards
AUSTIN, Texas (April 2, 2013) –- Financial advisers that work with Texas state agencies to place bonds should be held to the same conflict of interest standards that apply in the private market, R Street Texas Director Julie Drenner said today in testimony to the state House Insurance Committee.
Drenner’s testimony came in a hearing on H.B. 1890, legislation that would apply integrity standards based on the federal Sarbanes-Oxley Act to firms that advise on the bonding capacity of the Texas Windstorm Insurance Association and other client agencies of the Texas Public Finance Authority.
“By adding a cooling-off period of one year for audit teams who subsequently participate in market transactions, this bill affords TWIA and all other TPFA clients unbiased advice of the type that any private firm would demand,” Drenner said.
Drenner noted that the legislation is timely in light of recent questions regarding the financial dealings of the Cancer Prevention and Research Institute of Texas, and that it would remain relevant to protecting other agencies even if TWIA changes its funding structure in the future.
“By ensuring conflict of interests are banned from the financial process, we will protect taxpayers and instill confidence in our public institutions,” Drenner said.
