Whenever the Securities and Exchange Commission reorganizes you have to wonder what the impact will be on those subject to regulation by the SEC. Earlier, the SEC announced a new Office of Risk and Strategy within the Office of Compliance Inspections and Examination.
“The Office of Risk and Strategy will lead our exam program’s risk-based, data-driven, and transparent approach to protecting investors,” said OCIE Director Marc Wyatt. According to the SEC’s press release “[t]he new office will consolidate and streamline OCIE’s risk assessment, market surveillance, and quantitative analysis teams and provide operational risk management and organizational strategy for OCIE.”
I think it’s a good thing for OCIE to increase its use of data in looking at risky firms. The amount of data coming into the SEC has increased dramatically with addition of private fund managers into SEC registration, the Form PF filings and increased trade review.
The news has been sparse as to whether the new office is a new initiative or merely a centralization of existing initiatives. OCIE has been saying for years that its exam process is risk driven. Leading up to an exam, OCIE has looked at many other firms to determine that those present fewer risks.
Hopefully, the new office will allow the SEC to better focus on firms with greater risk.
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