With Paul Atkins officially sworn in as the SEC’s new Chairman, the regulatory body faces what could be dramatic changes ahead. In two recent ThinkAdvisor stories, FrontLine’s Founder and President Amy Lynch discusses how certain expected shifts in the SEC’s policies and goals would impact the industry. Through lead comments and several quotes, Ms. Lynch sees the effects of DOGE reducing SEC staff, in turn, creating the need for the SEC to re-evaluate its standard processes and find ways to reduce its workload. This includes the SEC considering raising the assets under management (AUM) threshold that requires an investment adviser to register with the SEC, which would decrease the number of firms under its oversight by turning over smaller firms to the states. Ms. Lynch explains that this would lighten the SEC’s examination burden and increase its ability to examine more registrants each year. However, most states would be challenged by the registration change and are not in a position to take on a higher number of advisers. The SEC is also reportedly reorganizing its regional offices under broader geographic areas. According to Ms. Lynch, these moves could stem from the SEC being stressed beyond its means and seeking ways to offset its reduced capabilities.
On the SEC’s policy goals under Atkins, Ms. Lynch states that these would include looking for ways to deregulate through modifying existing regulations, scaling back enforcement activity and reviewing current cases for worthiness. She expects Atkins will likely not deviate from this path, even in a highly volatile market environment, unless a true crisis emerges that requires regulatory intervention.
See ThinkAdvisor, “SEC Weighs Raising AUM Threshold for Advisor Registration” and ThinkAdvisor, “Paul Atkins Takes Helm of a Very Different SEC”
