SEC Chairman White Speaks on CCO Enforcement Actions

August 9, 2015

SEC Chairman Mary Joe White addressed the SEC's enforcement activity with respect to CCOs of advisers and broker-dealers at the Compliance Outreach Program for Broker-Dealers. She acknowledged the complex and challenging environment faced by compliance personnel, but also stressed the need for strong compliance programs. 


She stated:

Our enforcement program also emphasizes the importance of a strong compliance program.  We do this by highlighting in our orders situations where a compliance program operated effectively in identifying misconduct; by bringing enforcement actions when those programs have failed, particularly in the investment adviser realm where there is a specific requirement for compliance policies and procedures; and by requiring independent consultants in appropriate cases to ensure that compliance policies are crafted to guard against misconduct recurring.

She further stated that it is not the SEC’s intention to use its enforcement program to target compliance professionals.  However, she said, the SEC must, of course, take enforcement action against compliance professionals if it sees significant misconduct or failures by them.  She noted that being a CCO does not provide immunity from liability. On the other hand, she stated that SEC enforcement actions should not be seen by conscientious and diligent compliance professionals as a threat.  She concluded that the SEC does not bring cases based on second guessing compliance officers’ good faith judgments, but rather “when their actions or inactions cross a clear line that deserve sanction."

Click here to access the speech.


Categories

Investment Advisers, Investment Companies