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SEC exams to focus on retirement savers, markets

Exam priorities for the Securities and Exchange Commission in 2018 include protecting retirement savers, critical market infrastructure providers, anti-money laundering, cybersecurity and oversight of self-regulatory organizations including FINRA, the agency's office of compliance inspections and examinations said Wednesday.

SEC Chairman Jay Clayton said in a statement that the exam division will be maximizing resources "with a keen eye toward asset verification, market infrastructure and duties owed to retail investors."

For what SEC officials call Main Street investors saving for retirement, OCIE exams will look at how fees are disclosed and calculated, other expenses and charges to investors, how representatives selling products and services to investors are supervised, and how fixed-income securities customer orders are processed. Part of the retail investor focus will include monitoring the growth of cryptocurrencies and initial coin offerings to ensure adequate risk disclosures.

On market infrastructure, exam priorities will continue to look at service providers such as clearing agencies, national securities exchanges and transfer agents, some of which have new rules in place.

While many of the priorities echo those from 2017, a new focus this year will be how broker-dealers and municipal advisers are examined by the self-regulatory organizations Financial Industry Regulatory Authority and Municipal Securities Rulemaking Board.

The announcement also notes that more priorities may be added as market conditions change or as OCIE officials notice emerging risks. Annual examination priorities are based on feedback from examination staff, who also consult with the commissioners, other divisions, the SEC's investor advocate and other regulators.