SEC Reveals Top Exam Priorities for 2023

The Securities and Exchange Commission released Tuesday its exam priorities for 2023, with exams of advisors’ compliance with the new marketing rule and Regulation Best Interest topping the list.

The exam division said that it will focus on whether registered investment advisors have adopted and implemented written policies and procedures to prevent violations by advisors and their supervised persons of the new rule and whether RIAs have “complied with the substantive requirements” of the rule.

Also a priority will be exams of broker-dealers’ and RIAs’ use of emerging technologies and cryptocurrencies and how these firms are “employing new practices, including technological and on-line solutions to meet the demands of compliance and marketing and to service investor accounts,” the agency explained.

Exams of registrants “will focus on the offer, sale, recommendation of, or advice regarding trading in crypto or crypto-related assets” and include whether the firm:

met and followed their respective standards of care when making recommendations, referrals, or providing investment advice; and
routinely reviewed, updated, and enhanced their compliance, disclosure, and risk management practices.

“In a time of growing markets, evolving technologies, and new forms of risk, our Division of Examinations continues to protect investors,” SEC Chairman Gary Gensler said in releasing the priorities. “In executing against the 2023 priorities, the Division will help ensure compliance with the federal securities laws and rules.”