SEC Ramps Up Scrutiny of RIAs and It Shows

or years, consumer advocates have called for more frequent review and monitoring of registered investment advisors by the Securities and Exchange Commission. The historically low audit numbers has even led lawmakers to consider other options, such as requiring advisors hire third-party examiners.

But recent SEC enforcement results for fiscal year 2016 show the agency has taken scrutiny of RIAs to a new level.

The agency said it brought 160 cases against investment advisors or investment companies, a record, and the highest number of independent or standalone cases involving these groups, at 98, for fiscal year 2016, ending September.

Overall, the SEC filed 868 enforcement actions during the year, up from 807 in fiscal year 2015 and 755 in fiscal year 2014. But the agency didn’t order as much in penalties, with disgorgement and penalties totaling over $4 billion, compared to $4.19 billion last year and $4.16 billion the year prior to that.  MORE