SEC Announces 2016 Exam Priorities

The SEC's Office of Compliance Inspections and Examinations ("OCIE") announced the agency's priorities for this year on January 11. Commission staff will focus on three broad areas: Retail Investors, Market-Wide Risks, and increased used of Data Analytics. Retail Investors Seniors top the list in this category, as the SEC continues its "ReTIRE" initiative announced last June. A nod to the aging boomer bubble, the ReTIRE program is a multi-year effort focusing on investment-adviser and broker-dealer issues in the retirement savings context, including: reasonable-basis suitability; conflicts of interest; supervision and marketing / disclosure. The ReTIRE announcement is here. Other retail issues facing scrutiny include ETFs, branch supervision, fee-selection and reverse churning, variable annuities and pension advice. Market-Wide Risks Cyber-security is first here, following the Commission's second such initiative launched last September (here). The Staff also will examine for risks associated with potentially illiquid fixed-income securities and clearing issues. Data Analytics The SEC continues its efforts to use big data to better identify elevated and emerging risks, primary among them AML and related microcap fraud. Other data-analytics targets include recidivist representatives, excessive trading and product promotion. Other Issues to Watch OCIE will continue its efforts to reach new registrants and compliance with newly-registered municipal advisors under that emerging regulatory regime. Private placements, especially the EB-5 program, will face continued scrutiny, as will private fund advisers and transfer agents. The announcement is here.

Thomas K. Potter, III ( is a partner in the Securities Litigation Practice Group at Burr & Forman, LLP. Tom is licensed in Tennessee, Texas and Louisiana. He has over 29 years' experience representing financial institutions in litigation, regulatory and compliance matters. See attorney profile. © 2016 by Thomas K. Potter, III (all rights reserved).

Posted in: OCIE, SEC
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