2025 SEC Division of Examinations Priorities

Posted by  Kristin A. Snyder, Julie Riewe, and Robert Kaplan, Debevoise & Plimpton LLP, on Sunday, November 10, 2024

Editor's Note:

Kristin A. Snyder, Julie Riewe, and Robert Kaplan are Partners at Debevoise & Plimpton LLP. This post is based on their Debevoise memorandum.

Key Takeaways:

• On October 21, 2024, the U.S. Securities and Exchange Commission’s (the “SEC”) Division of Examinations (the “Division”) released its 2025 Examination Priorities (the “Priorities”). The Priorities provide insight into the products, practices, and services the Division views as presenting heightened risk to investors or capital markets and will focus on in its future examinations.
• Despite the vacatur of the Private Fund Adviser Rules, the 2025 Priorities make clear that the SEC will continue its focus on private fund advisers, shifting its emphasis away from many areas in last year’s Priorities and toward new ones such as compliance with the new amendments to Form PF. The 2025 Priorities also reflect a focus on integration of artificial intelligence, security-based swap execution facilities, funding portals, compliance with the amendments to Regulation S-P and Rule 15c6-1, firms that employ digital engagement practices, and Systems Compliance and Integrity entities’ incident response plans.
• Along with its new substantive priorities, the Division notes that it made structural changes to focus more specialized resources on supporting its priorities with regard to broker-dealers and exchanges. Those include building out a group to focus on national securities exchanges, adding a national risk strategist to assess and examine planning considerations, and adding a new associate director to strengthen the program’s home office.

(more…)