Consistent with recent years, early this fiscal year the SEC’s Division of Examinations (the “Examinations”) has released its 2026 examination priorities (“Priorities”). The Priorities signal a more engagement‑oriented program consistent with one of Chairman Atkins’ mantras, framing regulatory oversight and compliance as a two‑way conversation—not a “gotcha” exercise. In the prologue, Examinations leadership: (1) promises to share observations and deepen outreach with registrants and SROs, and to harmonize its work with that of the Commission’s various policy divisions and (2) underscores its plan for deploying limited resources to the highest risk areas for investors and market integrity. The second issue is a perennial one for the SEC but is particularly acute following the significant reduction in headcount the SEC has experienced in the past nine months. Notwithstanding agency changes, in our experience, the work of Exams has generally continued to proceed apace.
SEC Operations
What Investment Advisers Should Expect from SEC Enforcement Post-Shutdown
If the first few months of the new SEC administration has shown anything, it is that investment advisers should expect the SEC to remain active in its enforcement of the Investment Advisers Act. Despite an overall slowdown in enforcement actions this past fiscal year, the Enforcement Division continued to pursue investment advisers for a variety of different violations, such as the custody rule, marketing rule, Rule 105, deficient policies and procedures, and certain negligence-based conduct involving evergreen issues like conflicts of interest and fees.[1]
Following Chairman Paul Atkins’s directive, the SEC is likely to focus on bread-and-butter securities law violations involving market participants who “lie, cheat, and steal” and on the most vulnerable investors, such as retail investors and seniors. As a result, investment advisers can expect the SEC to focus its efforts on core violations of the Advisers Act, including Sections 206(1) and (2), Section 207,[2] and Rule 206(4)-8 claims, and less attention on novel legal theories that might be seen as second-guessing management or stifling innovation.
A few themes have emerged as to the type of conduct the SEC’s enforcement regime may focus on after the shutdown.
Chairman Atkins Discusses SEC Enforcement: An Exercise of Government Power “Tempered by Fair Process, Good Judgement, Integrity and Rectitude”
U.S. Securities and Exchange Commission (“SEC” or “Commission”) Chairman Paul S. Atkins outlined some foundational themes for SEC enforcement in a recent keynote address at Fordham Law’s 25th Annual A.A. Sommer, Jr. Lecture on Corporate, Securities, and Financial Law.[1] This was the Chairman’s second important enforcement-related speech in his career. The first one came 18 years ago at the same A.A. Sommer, Jr. Lecture, when then-Commissioner Atkins discussed the Wells process and potential reforms to the SEC’s enforcement program. This time, as Chairman, he used the speech to begin shaping enforcement the way he has long discussed.
The SEC’s New Regulatory Agenda = 180 Degree Turn from Prior Administration
The U.S. Securities and Exchange Commission today released its much-anticipated “Spring” regulatory agenda. The agenda removes more than a dozen items from the Fall 2024 agenda and adds nearly double that to the Spring 2025 agenda. The two proposed rules that remain from Fall 2024 had their titles (and substance) changed (e.g., the “Rule 144 Holding Period” became the “Rule 144 Safe Harbor” and “Foreign Issuer Reporting Modernization” became “Foreign Private Issuer Eligibility”).
The Wells Process Needs Modernization
The SEC’s Wells process, which allows prospective respondents to respond to potential charges, has remained largely unchanged since the 1970s despite significant evolution in enforcement practices and market complexity.
It’s time for the SEC to reform and update the process. The stakes in SEC enforcement actions have grown, with higher penalties and broader consequences for respondents. Opaque and inconsistent practices undermine the process’s core purpose: ensuring all relevant material is considered before imposing sanctions.
SEC Speaks 2025: A New Day at the SEC
On May 19 and 20, 2025, U.S. Securities and Exchange Commission (“SEC” or “Commission”) Chairman Paul S. Atkins and other senior SEC officials convened in Washington, D.C. for the annual SEC Speaks conference. The Commission looked back at the last four years and outlined its strategic priorities going forward under President Trump’s second administration. The post below focuses on the SEC’s changing approach to enforcement.