Risk & Compliance

SEC Seeks Wider Role in ”Sweep” Exams

In recent years, the regulator's ''inspections and exams'' division has targeted particular types of possible misconduct, a practice that has been ...
Stephen TaubFebruary 28, 2006

Paul Atkins expects that he and his fellow SEC commissioners will be getting more involved in “sweep examinations” that are conducted by the Office of Compliance Inspections and Examinations (OCIE), according to Reuters.

Atkins, who made the remarks during a speech to investment advisers, noted that “OCIE is working on coordination and has committed to me that the commission will have a chance to weigh in on sweep exams.”

The wire service noted that before 1995, when the OCIE was created by former SEC chairman Arthur Levitt, each of the SEC’s four primary operating divisions conducted its own inspections and examinations. Staffers in those divisions reportedly complained of insufficient resources, and concerns about overlapping exams were reportedly raised as well.

Nowadays, added Reuters, OCIE examiners conduct thousands of inspections. Traditionally, the division has conducted regularly scheduled exams, but in recent years, the OCIE has also launched into risk-based reviews that target particular types of possible misconduct — a practice that has been criticized by some business groups, Reuters noted.

According to the wire service, Rep. Vito Fossella (R-N.Y.) has introduced a bill to eliminate the OCIE. Fossella reportedly asserted that the SEC would become more efficient if the inspections and examinations were once again handled by the regulator’s operating divisions.