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NEWSLETTER: It’s clear the SEC is continuing to make strides in crypto regulation, with its recent $198 million fraud charge against PGI Global’s Founder and three new developments that are set to reshape firm obligations.
As the 2023 Safeguarding Rule and SAB 121 are firmly on the agenda and a public roundtable having been run by the regulator on the 25th of April, we may have sight of more guidance – and perhaps a new rule – later this year.
RIAs have even more to contend with as the SEC reshapes their leadership in a sweeping reorganization. With Paul Atkins now confirmed as Chair of Commission, and the agency consolidating its regional structure, preparation for more centralized oversight and streamlined compliance is a must.
Whistleblowers continue to be rewarded for their efforts by the regulator with a recent award of $6 million being awarded to multiple individuals. The amount was awarded to joint whistleblowers who provided new information leading to the start of an examination. Remember that proactive engagement is key to recognising risks up front to identify and prevent wrongdoing.
The SEC is also currently evaluating whether to raise the minimum regulatory assets under management (RAUM) threshold for registration. Currently, that RAUM threshold is $100 million. The new Chair of the SEC, Paul Atkins, seems to share the sentiments presented by ex-Chairman Mark Uyeda, when on April 8th, he asked that the SEC staff evaluate current thresholds given the significant increase in registered investment advisers. The review is therefore likely set to continue and will include a public comment period before final adoption.
Lastly, it’s worth noting that the SEC has announced a two-year extension of its effective and compliance dates for Form N-PORT and Form N-CEN rule amendments adopted in August 2024. This means that a vast majority of registered funds will need to report on portfolio-related information more frequently, so make sure to take this into account when reviewing your compliance procedures.
If you have any questions about or require guidance on any of the topics mentioned above, let us know.
Rebecca Thorpe, Global Head of Regulatory Consulting
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