Lessons From the SEC Office of Compliance Inspections and Examinations’ 2019 Priorities
January 2, 2019
On December 20, 2018, the U.S. Securities and Exchange Commission Office of Compliance Inspections and Examinations released its 2019 Examination Priorities.
The six themes for this year’s priorities are: retail investors (including seniors and those saving for retirement), compliance and risk in registrants responsible for critical market infrastructure (clearing agencies, transfer agents, national securities exchanges and Regulation SCI entities), oversight of the Financial Industry Regulatory Authority and Municipal Securities Rulemaking Board, digital assets, cybersecurity and anti-money laundering.
The only new theme for 2019 compared to 2018 is digital assets, which we take to imply a plan to more closely—and substantively—regulate investment advisers and broker-dealers involved with this asset class. The 2019 priorities also more explicitly than the 2018 priorities describe specific practices that OCIE found concerning in examinations of those entities, many of which involved failure to adequately safeguard client assets and the adequacy of disclosures of conflicts of interest. We expect to see a corresponding focus in Enforcement Division investigations and cases on these issues as a result.
Click here, to continue reading on the Cleary Enforcement Watch blog.