On Monday, June 22, 2015, the Securities Exchange Commission (“SEC”) Office of Compliance Inspections and Examinations (“OCIE”) announced that it was launching a multi-year Retirement-Targeted Industry Reviews and Examinations (“ReTIRE”) Initiative. The new ReTIRE Initiative follows OCIE’s 2015 Examination Priorities, which focuses on “examining matters of importance to retail investors and investors saving for retirement.”
The ReTIRE Initiative addresses high-risk areas of broker-dealers’ or investment advisers’ sales, investment and oversight procedures, with emphasis on select areas where retail investors saving for retirement may be harmed. Specifically, the ReTIRE Initiative will focus on the following areas:
- Reasonable Basis for Investment Recommendations: Broker-dealers and investment advisers must have a reasonable basis when making recommendations or providing investment advice. OCIE staff will assess how registered representatives and investment adviser’s: 1) select account types; 2) perform due diligence on investment options; 3) make initial investment recommendations; and 4) provide on-going account management.