The SEC and the Chief Compliance Officer, 2013


Mary Jo White recently gave a speech before the National Society of Compliance Professionals that I found noteworthy.  It focused on the role of the Chief Compliance Officer.  Well, that is obviously not the remarkable part.  What was remarkable about it though was the softer stance it seemed to signal.  I asked myself: Are the days where CCOs were held accountable for failure to supervise, to establish adequate procedures, to fail to perform adequate due diligence, etc. etc., a thing of the past?

“Although we occasionally bring enforcement actions against compliance personnel, compliance officers who perform their responsibilities diligently, in good faith, and in compliance with the law are our partners and need not fear enforcement action,” White said.   “You have a very tough job in a complex industry where the stakes for all concerned are extremely high. We recognize that and have tremendous respect for the work you do. For our part, we will do everything we can to help empower you so that you can do your jobs even more effectively,” White concluded.

It sounds as if the SEC 2013.0 has a good grasp of the realities that a Chief Compliance Officer faces, and respect for it to boot.  On the enforcement/empowerment part, let’s see whether she comes through.

One more thing—read the SEC risk alerts.  They present the findings on common issues that the SEC derives from a series of examinations.   I’d like to mention specifically the recent one on issues with the custody rule.  And if you have not already done so, please familiarize yourself with the list of exam priorities that the examination program published earlier this year.

Like everyone else, the SEC just likes to be heard.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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