RIA Compliance Blog
In December 2016, then acting Chairwoman of the Securities and Exchange Commission (“SEC”) Mary Jo White drafted a proposal that, if adopted, would enable third-parties, such as private sector organizations, to perform compliance exams of investment advisers. Chairwoman White drafted this proposal in order to “increase SEC oversight of the approximately 11,800 registered investment advisers.” In 2016, the SEC conducted evaluations of only 11% of all registered investment advisers.
However, Michael Piwowar, the current SEC Chairman, has expressed opposition to the proposal. Piwowar claims that allowing third parties to conduct investment adviser exams would not increase the SEC’s efficiency because the SEC would still be required to monitor the third parties that it hires to conduct the exams. He is also of the opinion that requiring SEC employees to conduct the exams would better enable the SEC to become aware of “trends in the industry.” Continue reading ›