“You'll find that almost every exam focuses on marketing,” says Natasha Vij Greiner of the SEC.
The SEC's two priority exam areas this year are the commission's new marketing rules and advisors' use of artificial intelligence, said Natasha Vige Greiner, deputy director of the SEC's Division of Examinations.
“You'll find that almost every exam focuses on marketing,” Greiner said Thursday at the Investment Advisers Association's annual compliance conference in Washington. “How can you look at a company without looking at its marketing materials?”
Greiner, who was recently appointed as the new director of investment management starting Friday, said the agency is continuing its focused examination of the new marketing rules.
Greiner also said the agency will share its observations, perhaps as a risk warning, of what last year's exam revealed in terms of “what's working and what's not working” in terms of compliance with marketing rules. He indicated that he was thinking of doing so.
Greiner said some businesses still “don't even know this rule came out.”
In June last year, the agency warned in its second marketing regulatory compliance risk alert that it was ramping up inspections of advisers' regulatory compliance, with a focus on testimonials and testimonials, third-party reviews and Form ADV.
The first Marketing Rule Risk Alert, released on September 19, 2022, warned of other areas that SEC examiners will begin to focus on on the exam.
AI exam
When it comes to AI, Greiner informed the exam department is “focused on the use of AI for advisors and all enrollees.” “We are careful about disclosure when it comes to testing.”
The testing department “thoroughly investigated'' [Form] We looked at ADV, brochures and websites to see what advisors were saying about AI and considered several companies,” Greiner said.
AML rules
The SEC will also be responsible for enforcing the Treasury Department's anti-money laundering regulations for investment advisers, once finalized.
The Treasury Department's Financial Crimes Enforcement Network announced the proposal on February 13th.
The rules would require advisers to implement policies to prevent money laundering and terrorist financing, including filing suspicious activity reports and other record-keeping duties.
Greiner told attendees that the SEC is “working with Treasury staff in connection with this rule.” Their proposal certainly gives us review authority. ”
In preparation for the exam, Greiner said the agency will educate and train staff, as well as other regulations.
“For many years, AML has been a top priority for the SEC exam,” Greiner said.
