SEC Wants to Add 83 Examiners

Posted on July 21st, 2023 at 1:22 PM
SEC Wants to Add 83 Examiners

From the desk of Jim Eccleston at Eccleston Law 

The Appropriations Committee appropriated $2.4 billion to the Securities and Exchange Commission (SEC), $194 million more than the fiscal year 2023 enacted level and close to $73 million less than the budget request. That cut back on the agency’s ability to add about 170 additional positions, SEC Chairman Gary Gensler said.

The SEC requested use of its 2024 budget boost in a Senate appropriations bill to add 83 additional full-time examiners. This number would increase the SEC Examinations Division to 1,144 full-time examiners, “allowing it to keep pace with the market challenges of the last decade”, Gensler told the senators during a Senate Appropriations Financial Services and General Government hearing, held Wednesday.

From 2017 through 2022, the number of clients of registered investment advisers grew nearly 70% from 34 million to 57 million, according to Gensler. “During that same period, average daily trading in the equity markets more than doubled from more than 30 million transactions to more than 77 million.”

Gensler went on to say that, “such growth and rapid change also mean more possibility for wrongdoing. As the cop on the beat, we must be able to meet the match of bad actors. Thus, it makes sense for the SEC to grow along with the expansion and increased complexity in the capital markets.”

Advisor numbers have grown significantly in the last five years, with RIAs growing by 20% to about 15,000, up from approximately 12,500 in 2017, Gensler reported. He also reported that, in each of the past five years, the SEC worked in parallel with self-regulatory organizations to examine registered broker-dealers, jointly examining nearly half of them — even as the number of daily transactions in the equity markets more than doubled.

 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, transition, regulatory, and disciplinary matters.

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