As reported in more detail on our Regulatory Oversight blog, the Securities and Exchange Commission’s Division of Examinations recently released its 2024 Examination Priorities report. The report underscores the SEC’s intent to focus on risk areas impacting market participants, particularly those related to cryptocurrency and emerging technology.

The SEC will scrutinize the offer, sale, recommendation, and trading of crypto assets. This includes assessing whether registrants meet their standards of conduct when advising on crypto products, and whether they routinely review and enhance their compliance practices. Technological risks associated with blockchain and distributed ledger technology will also be examined. In addition, the SEC will pay attention to broker-dealers and investment advisers leveraging emerging technology, such as mobile applications and automated investment advice.

The report also highlights the SEC’s focus on anti-money lL\aundering (AML) compliance. Financial institutions are required by the Bank Secrecy Act (BSA) to establish AML programs tailored to their specific risks. The Examinations Division will review whether broker-dealers and investment companies are appropriately tailoring their AML programs, conducting independent testing, establishing adequate customer identification programs, and meeting suspicious activity report obligations.

The report underscores the SEC’s commitment to closely monitor the impact of digital assets and emerging technologies on the market. Proactive compliance measures are essential for industry participants to successfully navigate future examinations.

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Photo of Jay Dubow Jay Dubow

Jay co-leads the firm’s Securities Investigations + Enforcement Practice Group. He focuses his practice on complex business litigation, with a special emphasis on defending against shareholder derivative and securities class action litigation. He also represents clients involved in investigations by the U.S. Securities…

Jay co-leads the firm’s Securities Investigations + Enforcement Practice Group. He focuses his practice on complex business litigation, with a special emphasis on defending against shareholder derivative and securities class action litigation. He also represents clients involved in investigations by the U.S. Securities and Exchange Commission (SEC), the Pennsylvania Department of Banking and Securities, and various self-regulatory organizations, including the Financial Industry Regulatory Authority, Inc. (FINRA). He also conducts internal investigations on behalf of clients. Such investigations have included allegations involving the Foreign Corrupt Practices Act (FCPA), whistle blower claims, financial fraud, and civil and criminal violations of various federal and state laws.

Photo of Matthew Orso Matthew Orso

Matt is a skilled advocate for clients subject to regulatory oversight, including financial services companies. He provides guidance by developing informed strategies for investigations, enforcement matters, compliance, and litigation.

Photo of Ethan G. Ostroff Ethan G. Ostroff

Ethan’s practice focuses on financial services litigation and compliance counseling, as well as digital assets and blockchain technology. With a long track record of successful litigation results across the U.S., both bank and non-bank clients rely on him for comprehensive advice throughout their

Ethan’s practice focuses on financial services litigation and compliance counseling, as well as digital assets and blockchain technology. With a long track record of successful litigation results across the U.S., both bank and non-bank clients rely on him for comprehensive advice throughout their business cycle.

Photo of Trey Smith Trey Smith

Trey is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice. He focuses his practice on helping financial institutions and consumer facing companies navigate regulatory investigations and resulting litigation. He has experience litigating the Consumer Financial Protection Act, the FTC Act…

Trey is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice. He focuses his practice on helping financial institutions and consumer facing companies navigate regulatory investigations and resulting litigation. He has experience litigating the Consumer Financial Protection Act, the FTC Act, the Truth in Lending Act, state UDAAP statutes, and other consumer protection laws.