Fulfilling its promise to zero in on advisors who have never been examined, the Securities and Exchange Commission announced Thursday its exam sweep of such advisors through its Never-Examined Advisor Initiative.
Jane Jarcho, national associate director of the SEC’s Office of Compliance Inspections and Examinations’ exam program for advisors and investment companies, said Thursday that the initiative would be directed at never-examined advisors registered with the SEC for three or more years.
“Our examinations will focus on areas most important to protecting investors,” Jarcho said. “We will also promote compliance by engaging with these advisors through outreach efforts.”
OCIE will conduct examinations of a “significant percentage of advisors” that have not been examined since they registered with the SEC. These examinations, Jarcho said, will concentrate on the advisors’ compliance programs, filings and disclosure, marketing, portfolio management and safekeeping of client assets.
Andrew Bowden, the OCIE director, said last October that the agency would take aim at the group of about 4,000 RIAs that have never been examined.
Excluded from the initiative, however, will be advisors to private funds, which are being examined pursuant to the “Presence Exam” initiative launched in October 2012.