This was another “dark session” with about 30 compliance professionals sitting down for an informal discussion with former SEC Chairman Harvey Pitt. I am not going to share detailed notes, just some general issues that were discussed, with no attribution to any individual.
Compliance is really about non-compliance. The only reason compliance is relevant is because someone was non-compliant. The government usually comes in and looks at your compliance program at the opposite end that the organization looks at compliance.
It is better to build a relationship with the SEC before you need something. If you show when you have a problem, you waited too long. The SEC has learned not to tell you that something is not a problem.
It is important to see what is being said about your company, even a “blog written by an imbecile,” to see what is out there. If something is harmful, you need to decide whether to react. The SEC has people who troll the internet looking for information. They certainly will troll for information once they open an investigation.
There was concern about how an already understaffed SEC will be able to regulate an additional 8,000+ companies if hedge funds are going to be regulated by the SEC.
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