The SEC's Office of Compliance Inspections and Examinations (OCIE) has revised its exam modules to include specific questions about investment advisor and broker-dealer compliance division layoffs. OCIE staff will ask who, if anyone, from the compliance department at examined investment advisors and broker/dealers has been laid off, what their responsibilities were and how those responsibilities have been reallocated.
OCIE Director Lori Richards, who previously advised firms against making excessive cuts to their compliance programs, indicated that those firms that have decided to make cuts will face close scrutiny regarding how those decisions were made. Examiners will focus on whether proper risk assessments were performed in deciding where to cut compliance resources.
Story: "OCIE Zeroes in on Compliance Cuts," Compliance Reporter (April 9, 2009)