CCO Resource Hub: Division of Examinations

Chief Compliance Officer Committee

Resources Related to the SEC’s Division of Examinations, Including Document Request Lists

The SEC’s Office of Division of Examinations (the “DoE”) that, until late 2020 was known as the SEC’s Office of Inspections and Examinations (OCIE), engages with SEC registrants both through conducting exams and by publishing information relevant to them. This portion of the Resource Center provides CCOs access to this information as described below.

The Division of Examinations’ Document Requests

Members of the CCO Committee have long shared with ICI copies of the document requests they receive from the DoE in connection with routine, targeted, or specialized examinations/reviews. The Institute redacts identifying information from these documents and posts them on the Resource Center. As noted previously, we expect all members who access these documents to maintain their confidentiality by not sharing them outside your firm, including not sharing them with your outside counsel or consultants.

The Division of Examinations’ Risk Alerts

Years ago, at the recommendation of the ICI, the DoE’s National Examination Program began publishing Risk Alerts as a vehicle to communicate with registrants. Typically, these Risk Alerts serve two purposes. First, they are used to alert registrants to upcoming targeted examinations, including the purpose of such review and the type of information the SEC will seek during it. When it conducts targeted reviews, the DoE usually visits 25-50 registrants to assess their policies and procedures relating to the topic of the review. By publishing a Risk Alert prior to a targeted examination, OCIE is able to influence the conduct of far more firms than it will visit during the targeted review.

The second purpose for which the DoE publishes Risk Alerts is to push information about the results from a targeted review out to registrants after the DoE has completed the review. This type of Risk Alert enables registrants to better understand policies, procedures, and practices that, in the DoE’s view, may be more effective or less effective than others. These are intended to assist registrants in fulfilling their compliance responsibilities. In reading a Risk Alert, it is important to remember that they are not law and the DoE will not cite a registrant for having policies and procedures that are not consistent with those identified in a Risk Alert so long as the registrant’s policies and procedures are reasonably designed to ensure compliance with the Federal securities laws as required by Rule 38a-1 under the Investment Company Act of 1940 (the SEC’s Fund Compliance Rule).

Priorities of the SEC’s National Examination Program

Several years ago, the National Examination Program of the DoE began publishing its priorities for the coming calendar year. These priorities are typically published by February and they highlight the areas that the DoE intends to focus its inspection activity on during the year. Obviously matters may arise that may divert the DoE’s intention but these Priorities provide registrants a list of areas/issues they may want to focus on in reviewing their operations. As noted above, when the DoE reviews an area listed in their Priorities, it typically does so by visiting 25-50 registrants to review their policies and procedures related to the area/issue.

The documentation provided by ICI that may be accessed by committee and task force members is restricted to members use only and not for distribution or reproduction. Documentation may be used internally at member organizations as needed to facilitate committee and task force initiatives.