SEC unveils plan to investigate never-before-examined RIAs

Commission spells out activities it will focus on during exams

Feb 20, 2014 @ 2:22 pm

By Trevor Hunnicutt

The Securities and Exchange Commission on Thursday revealed new details about its plan to inspect registered investment advisers who have never previously been examined.

“The Never-Before Examined Initiative includes two distinct approaches: risk assessment and focused reviews,” according to a letter sent to the unexamined advisers. “The risk-assessment approach is designed to obtain a better understanding of a registrant. This type of exam may include a high-level review of an adviser's overall business activities, with a particular focus on the compliance program and other essential documents needed to assess the representations made on disclosure documents.

The focused review will examine “advisers' compliance programs, filings and disclosure, marketing, portfolio management, and safekeeping of client assets,” the statement said.

Officials with the regulator announced last October a plan to make examining the estimated 4,000 advisers who have never been visited by regulators an enforcement priority this year.

The commission's Office of Compliance Inspections and Examinations will zero in on about half of the firms that have never been examined, a group that includes those that have been registered for more than three years and are based in the United States.

On Thursday, the SEC said it would examine “a significant percentage” of the advisers.

Later this year, the SEC will host “regional meetings where [advisers] can learn more about the examination process.”

0
Comments

What do you think?

View comments

Recommended for you

Sponsored financial news

Featured video

INTV

Here's how we came up with our list of undiscovered talent in mutual funds

Senior columnist John Waggoner talks with assistant managing editor Susan Kelly about how hard work, curiosity and passion landed some fund managers on our list.

Latest news & opinion

SEC advice proposal unveiling: Here's what to expect

Chairman Jay Clayton will initiate momentous action Wednesday, as the commission meets to debate a rule on broker and adviser standards.

How active are the largest actively managed funds?

Active-share measures for the 15 largest actively traded mutual funds.

Morgan Stanley's success looks long in the tooth to analyst

Sanford C. Bernstein & Co. analyst Christian Bolu, concerned over stalled adviser growth and what it means for lending and deposit growth, believes the stock will "under perform."

Retirement coverage gap, 401(k) rollovers are big emerging threats for plan advisers

Proliferation of state retirement programs approaching the 'tipping point' where it will lead the federal government to step in.

Biggest arb awards firms won from their brokers

These are among the biggest arbitration decisions that brokerage firms have won from their brokers over the past year. The awards highlight intra-firm battles.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print