Statement On Recent And Upcoming Regulation Best Interest Examinations From The SEC Division Of Examinations, Division Of Examinations Staff
Date
21/12/2020
[1]Regulation Best Interest established a new, substantially elevated standard of conduct under the Exchange Act for broker-dealers and associated persons of a broker-dealer (collectively “broker-dealers” or “firms”).[2] After Regulation Best Interest’s June 30, 2020 compliance date, the Division of Examinations (“Division”) (formerly the “Office of Compliance Inspections and Examinations”) launched examinations to assess the Regulation Best Interest implementation efforts of broker-dealers. Division staff has assessed the results of its initial Regulation Best Interest examinations and now that approximately six months have passed since the Regulation Best Interest compliance date, the Division intends to begin its next phase by conducting more focused examinations as outlined below beginning in January 2021. As part of this effort, Division staff will examine whether broker-dealers have written policies and procedures and systems in place to achieve compliance with the Regulation.