Independent Broker Dealer Consortium

The SEC Examined 50+ RIAs Who Are Employing or Have Employed Individuals with a History of Disciplinary Issues and This is What They Found…

The U.S. Securities and Exchange Commission’s (SEC) Office of Compliance and Inspections (OCIE) performed over 50 examinations of registered investment advisers who employed or currently employ individuals with disciplinary events. The examinations were part of a “Supervision Initiative” for the purpose of assessing investment advisers’ oversight over individuals with past disciplinary events. On July 23, 2019, OCIE issued a Risk Alert identifying the “compliance issues” that it observed and ways in which firms can improve their compliance relating to those issues.


OCIE’s “Supervision Initiative” examinations focused on compliance programs, disclosures and conflicts of interest. Although the focus of the “Supervision Initiative” was oversight over individuals with prior disciplinary events, OCIE reviewed the investment advisers’ supervisory practices overall. Almost all of the investment advisers who were examined as part of the “Supervision Initiative” received deficiency letters. 

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