The Securities and Exchange Commission cracked down on Regulation Best Interest violations this year after industry complaints that the Financial Industry Regulatory Authority was taking the lead in levying fines.
The law firm Gibson Dunn reported in late June that while there's been a dearth of enforcement actions brought by the SEC related to Reg BI, more inquiries by the securities regulator are likely on tap. The firm said that the SEC thus far "has seemed content" to leave enforcement to FINRA, which has settled roughly 30 Reg BI enforcement matters since 2020, when Reg BI took effect.
The SEC also cited Reg BI in its recently released 2025 exam priorities. In particular, BD exams will focus on recommended products that are complex, illiquid, or present higher risk to investors, which may include highly leveraged or inverse products, crypto assets, structured products, alternative investments and products that are not registered with the commission, as well as products with complex fee structures or return calculations.
See the gallery for the SEC Reg BI fines levied this year.
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