Policy Patty Toolkit 

Making the world a little more compliant one toolkit at a time.


FINRA Enforcement Head Provides Principles on Enforcement Actions

Posted on February 12, 2018 at 2:40 PM

Susan Schroeder, Head of FINRA Enforcement, provided insights into the principles that guide their enforcement decisions. A summary is provided below.

Enforcement Actions

The first question asked about every potential case: is an enforcement action appropriate?

• We do not bring an enforcement action for the sake of bringing an enforcement action.

• We bring an enforcement action to fix something that is broken or to prevent future misconduct, either by th...

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SEC Publishes Its Exam Priorities for 2018

Posted on February 7, 2018 at 4:30 PM

The SEC's Office of Compliance Inspections and Examinations (OCIE) published its 2018 examination priorities. This year’s priorities will focus on matters involving critical market infrastructure, duties to retail investors, and developments in cryptocurrency, initial coin offerings, and secondary market trading. These are grouped into five categories:

(1) compliance and risks in critical market infrastructure;

(2) matters of importance to retail investors, including senio...

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FINRA releases report on exam findings

Posted on December 6, 2017 at 2:40 PM

FINRA released the Report on FINRA Examination Findings to help firms strengthen their compliance with securities rules and regulations. The report focuses on selected observations from recent examinations that FINRA considers worth highlighting due to their potential impact on investors and markets or the frequency with which they occur.

Highlights from Report


FINRA observed a variety of areas where some firms could improve their cybersecurity programs against...

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NASAA issues 2017 exam summary and cybersecurity checklist for Investment Advisers

Posted on November 2, 2017 at 7:55 AM

The North American Securities Administrators Association (“NASAA”) released a couple of very useful resources for investment advisers.

The first is a summary of NASAA’s 2017 results of the 1,203 reported exams of state-registered investment advisors. The exams covered 37 U.S. jurisdictions took place between January and June, with 2017 being the first year that cyber was tracked. The state securities regulators have oversight responsibility for investment advisors with...

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2017 Electronic Communications Compliance Survey - Smarsh

Posted on August 10, 2017 at 9:35 AM

Smarsh released its seventh annual Electronic Communications Compliance Survey (to access 2017 report see link below). The survey entails a 31-question survey involving 119 compliance professionals who provided input on current trends and insights on policies and practices on the usage, retention and supervision of electronic business communications. I reviewed this excellent survey and highlighted key and specific results summarized below.

The key takeaways from the survey:

- F...

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PCAOB Settles with PwC

Posted on August 6, 2017 at 1:00 PM
Aug. 2, 2017 The Public Company Accounting Oversight Board (PCAOB) recently censured and fined PricewaterhouseCoopers LLP (PwC) for violations in its examination and audit of Merrill Lynch, Pierce, Fenner & Smith, Incorporated's (Merrill Lynch) compliance with the SEC's Customer Protection Rule in fiscal year 2014. This rule requires a broker-dealer to hold certain customer securities in lien-free segregated accounts to protect them from creditor claims should the broker's business fail. As par... Read Full Post »