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SEC Examination Priorities for 2017

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January 24, 2017

Client Alert
The Securities and Exchange Commission’s (“SEC”) Office of Compliance Inspections and Examinations (“OCIE”) recently released its Examinations Priorities for 2017. A copy of the examination priorities letter is available here. While it does not provide an exhaustive list of examination focuses, OCIE’s letter focuses on issues involving investment advisers, broker-dealers, municipal advisors and transfer agents with a particular emphasis on protecting retail investors, senior investors and investors saving for retirement and assessing market-wide risks. Firms should review their policies, procedures and business activities in light of OCIE’s stated 2017 priorities. Firms should also review the Financial Industry Regulatory Authority, Inc.’s (“FINRA”) 2017 Regulatory and Examinations Priorities Letter which is described in our Client Alert available here.

Retail Investor Protection

Protecting retail investors remains a priority for the OCIE in 2017, and it will likely continue to be a focus for the foreseeable future. In this respect, OCIE has indicated that it will focus on the following areas, among others, in conducting its 2017 examinations:

Focusing on Senior Investors and Retirement Investments

In 2017, OCIE will devote increased attention to the following initiatives related to senior investors and those investing for retirement.

Assessing Market-Wide Risks

In 2017, OCIE will focus on the following initiatives related to assessing market-wide risks:

Other Exam Initiatives

OCIE will also focus examination efforts on:

Conclusion

Firms should consider the SEC examination priorities along with the recently released FINRA 2017 Regulatory and Examination Priorities Letter as they conduct their annual reviews of policies, procedures and business activities. Where firms observe deficiencies in their own practices, adjustments should be made before they find themselves the subject of a FINRA or SEC investigation, examination or enforcement action.

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