The SEC publishes a new Exam Handbook covering every stage of an examination
On October 1 the Division of Examinations published "The SEC Exam Handbook: A Practical Guide on Process and Engagement," replacing its earlier examination brochure. It walks registrants through each stage from initial risk assessment to the final disposition letter and includes preparation tips and ways to ask questions of the Division.
Why it matters: it is not a new rule, but it is the Division's own description of how an exam unfolds. Use it to test your exam-response plan. We wrote up how to put it to work.
Read our full breakdown →SEC proposes a custody framework for crypto assets held by advisers and funds
On October 1 the SEC proposed updating custody requirements under the Advisers Act and Investment Company Act for crypto assets, including conditional self-custody and eligibility for state trust companies as custodians (IA-7023). Comments are due 60 days after Federal Register publication.
Why it matters: custody is the gating issue for any adviser crypto offering. Nothing is effective yet. Our article covers what's proposed and how it connects to Regulation Crypto Assets.
Read our full breakdown →Performance fees from registered funds, interval-fund changes, and new accredited-investor pathways proposed
On September 30 the SEC proposed amending Rule 205-3 so advisers could earn performance-based compensation from registered funds and BDCs (capped at 20% of net gains, with board findings and separate disclosure), expanding the "qualified client" definition to the Regulation D accredited-investor standard, and modernizing interval funds under Rule 23c-3. It also asked for comment on adding FINRA-exam and credential-based paths to accredited-investor status.
Why it matters: a wider fee-eligible client base changes conflict, suitability, and fee-disclosure analysis. We wrote up the details.
Read our full breakdown →Zoe Financial pays $450,000 for an undisclosed referral incentive and a misleading description of how matches were made
In IA-7019 (September 28), the SEC found that Zoe Financial, an adviser running an online adviser-matching platform, did not adequately disclose its financial incentive to refer clients to advisers on its platform, and told clients matches were made "solely" from their questionnaire answers when salespeople often recommended advisers using undisclosed factors (January 2023 – October 2024). Section 206(2); cease-and-desist, censure, and a $450,000 penalty.
Why it matters: disclosure has to match what your people actually do. We covered what to check in your own program.
Read our full breakdown →Adviser took $425,000 in undisclosed loans from the funds it managed
In IA-7021 (October 2), the SEC found that CityVest Capital Inc., CV Manager LLC, and Alan P. Donenfeld took loans totaling $425,000 from three funds they managed between July 2019 and May 2025, using the money to cover CityVest's operating expenses, including payroll. The loans created material conflicts of interest that were not fully and fairly disclosed to or consented to by the funds and their investors. Section 206(2); censure, cease-and-desist, and $10,000 penalties each for CityVest and Donenfeld.
Why it matters: borrowing from a fund you manage is a conflict that needs full disclosure and informed consent. If your cash-management or related-party controls are thin, a thinly capitalized adviser is where this risk concentrates.
Read the SEC order →SEC charges a private fund manager over inflated statements and a missed SpaceX capital call
On September 30 the SEC charged Meyer Global Management LLC and CEO Owen E.H. Meyer in the Southern District of New York with Advisers Act antifraud violations in connection with MGM-managed private funds that held SpaceX and other pre-IPO securities. The SEC alleges Meyer misused fund assets for personal expenses, sent investors inflated account values, forced investors to accept reduced distributions in order to receive any funds, and failed to address a capital call deficiency, causing a fund to forfeit nearly $3 million. The SEC is seeking injunctions, disgorgement, and penalties; these are allegations, not findings.
Why it matters: valuation accuracy, use of fund assets, and capital-call controls are exam and enforcement staples for private fund advisers, and retail access to pre-IPO exposure keeps drawing attention.
Read the SEC press release →What we're leaving out
This week the SEC feed also included the J.P. Morgan order about a statutorily disqualified person's involvement in security-based swap transactions (a swap-dealer supervision matter), a final rule on Commission quorum (internal procedure), fraud cases against individuals with no registrant angle, routine Investment Company Act notices and orders, and a stream of administrative law judge and Commission procedural orders. None of these change anything for a typical RIA or broker-dealer compliance program, so we're leaving them out.
SEC issues an "innovation exemption" for trading tokenized NMS stocks
On September 17 the SEC granted temporary exemptive relief allowing Tokenized Securities Venues to trade tokenized National Market System stock using permissioned automated market makers and liquidity pools. The conditions include limits on the number of symbols and trading volume, verification that tokenized shares carry the same rights as the underlying stock, written notice to issuers before trading third-party tokenized versions, auditable public smart contracts on public blockchains, trading halts that follow halts in the underlying stock, and public disclosure of operations. The relief expires five years after publication, and the SEC requested comment.
Why it matters: this is the SEC building a regulated lane for tokenized equities rather than leaving them in a gray area. Broker-dealers and advisers considering tokenized products should note the conditions now, and expect the comment process to shape what comes next.
Read the SEC press release →OTC Link pays $575,000 for ignoring repeated exam findings on system security
On September 22 the SEC censured OTC Link LLC, a New York broker-dealer, and imposed a $575,000 penalty for Regulation SCI failures between August 2016 and March 2025. The SEC found OTC Link lacked written policies and procedures for system security, access control, and application vulnerability management, and failed to establish testing and remediation procedures, despite deficiencies being flagged repeatedly by the Division of Examinations.
Why it matters: Reg SCI applies to a narrow set of entities, but the lesson applies to every registrant. The aggravating fact was not the original deficiency but the failure to fix it after examiners raised it. Track every exam finding to closure, with an owner and a date, and be ready to show the evidence.
Read the SEC press release →What we're leaving out
Across these weeks the SEC feed also included a proposal to rescind the shareholder-proposal rule and reform proxy solicitation (issuer-focused), exemptive relief on inline XBRL filing, a U.S./UK readout on central counterparty resolution, an Investor Advisory Committee meeting notice, routine Investment Company Act notices and orders, administrative law judge and Commission procedural orders, and offering-fraud cases against unregistered promoters with no adviser or broker-dealer angle, such as the alleged $16 million New Jersey Ponzi scheme. None of these change anything for an RIA or broker-dealer compliance program, so we're leaving them out.
SEC charges 38 fake "advisers" who filed fictitious ADVs to look legitimate to retail investors
Thirty-eight entities filed Forms ADV to the SEC's public IARD system claiming exempt reporting adviser status — complete with fabricated compliance addresses, templated ownership disclosures, and in some cases fake SEC-registration certificates carrying real CRD and SEC numbers lifted from actual registrants. None had a genuine U.S. presence; the filings existed to make offshore operations look SEC-sanctioned to prospective investors.
We covered this one in full, including the ERA-vs.-registered-adviser distinction that made the scheme work and what both RIAs and legitimate ERAs should do in response.
Read our full breakdown →Form PF's next compliance date pushed back to July 1, 2027
The SEC extended the compliance date for the pending 2026 Form PF amendments for a third time — this round by nine months, from October 1, 2026 to July 1, 2027 — while the separately pending 2026 Proposed Form PF Amendments work through their own comment and adoption process. Current Form PF stays fully in effect; nothing about today's filing obligations changes.
Full timeline and what it means if you're a filer in our article.
Read our full breakdown →SEC formally proposes rescinding the pay-to-play rule entirely — Release IA-6994
What started in July as a Reg Flex Agenda entry to "ease" Rule 206(4)-5 is now a formal proposal to eliminate it outright, replacing it with a narrower amendment to the recordkeeping rule. The SEC's own fact sheet cites strict-liability foot-faults, a chilling effect on hiring, and pension plans losing access to advisers as the rule's core problems. Comment period is 60 days from Federal Register publication.
We updated our existing pay-to-play article in place with the full "how we got here" timeline and what the proposal would actually do.
Read the updated article →SEC charges Bay Area private fund executives in an alleged Ponzi-like scheme
The SEC charged private fund executives in the San Francisco Bay Area with running a multimillion-dollar Ponzi-like scheme, allegedly using new investor funds to pay purported returns to earlier investors rather than deploying capital as represented in fund offering materials. No litigation release detail beyond the press release is available yet.
Why it matters: another reminder that fund-level cash-flow and use-of-proceeds controls — not just disclosure language — are what examiners and, eventually, enforcement staff actually test.
Read the SEC press release →SEC charges a boiler-room operator with a $74 million pre-IPO fraud built on hidden markups
The SEC charged Andrew Spaventa and three entities he controlled — The Spaventa Group, TSG Capital Advisors, and TSG Alpha Partners — with defrauding more than 800 mostly retail investors, many of them retirees, out of $74 million between 2020 and 2025. The pitch: access to "pre-IPO" private companies through a fund, with no or low upfront fees. In reality, more than 100 cold-calling sales agents sold shares at markups averaging 46% above what Spaventa paid, and the resulting $23 million in hidden fees went largely to sales commissions and Spaventa personally.
Why it matters: the complaint charges broker-dealer registration violations alongside fraud — a reminder that "we're just a fund, not a broker" doesn't hold up when a sales force is compensated on commission for closing retail investors. If your firm uses any outside placement agents or referral arrangements, this is a useful case to walk through with them.
Read the SEC litigation release →Regulation Crypto Assets is now formally proposed — file number S7-2026-27
The crypto offering framework we covered last month has now been formally proposed, with a file number, release number, and a 60-day comment clock that starts running once it's published in the Federal Register. The core structure is unchanged: two new offering exemptions (up to $5M over four years, or up to $75M every 12 months), principles-based disclosure in place of full registration, and a conditional safe harbor out of "investment contract" status once an issuer's active managerial role ends.
Nothing is effective yet, and the comment period is the window to weigh in if this touches your business. See our full breakdown for what it means even for firms with no current crypto exposure.
Read our full breakdown →SEC goes to federal court to force compliance with a two-year-old subpoena
In a Texas oil-and-gas offering investigation, the SEC asked a federal court to compel a group of respondents to comply with subpoenas first issued in April 2024. According to the SEC's filing, the respondents had produced roughly 8,300 documents out of a set their own counsel described as potentially in the hundreds of thousands, and had repeatedly rescheduled or skipped testimony. No fraud finding has been made — this is purely about subpoena compliance.
Why it matters: it's a clean illustration of how document-production delay becomes its own liability, independent of whatever the underlying investigation turns up. A firm's ability to promptly locate, collect, and produce records in response to a regulatory request is itself something an examiner or investigator is watching.
Read the SEC litigation release →What we're leaving out
Across these two weeks the SEC feed also included a proposed transfer-agent modernization rule, a proposed amendment adding EU debt obligations to Exchange Act Rule 3a12-8, a new SEC/FDA memorandum of understanding, routine Investment Company Act notices and exemptive orders, and several administrative law judge scheduling orders. None of these change anything for an RIA or broker-dealer compliance program, so we're leaving them out.