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SEC Steps Up Routine RIA Exams

It is no surprise that the SEC has stepped up their routine exam cycle of RIAs under their jurisdiction, especially since they transitioned a number of them to the states where the RIA is domiciled. The numbers are staggering; only 8% of the SEC Registered RIAs were examined in 2012 and approximately 40% of SEC RIAs have NEVER been examined. The SEC will more than likely receive additional funding to increase their ability to conduct more exams. The focus on fiduciary standard and the subject of who will supervise the RIAs has taken a back burner. The question at hand: how will the SEC determine which firms will be visited? The firms that have never been visited, high risk firms determined by the SEC, newly registered firms…the possibilities are broad. What do we know? Your firm should be prepared for an on-site SEC exam within the two years. Are you ready? Do you know where your compliance program stands? We strongly encourage you to conduct a Compliance Assessment of your firm. This should include your compliance program, business initiatives, and an interview with your staff. RegMaven will work with your firm to assess your compliance program and understand your business aspirations. We will interview applicable staff members to understand which policies and procedures are in place and acted on – not just what is in the manual. Call us to learn how we work to create a compliance program which will evolve into a culture for your firm.

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