SEC Cybersecurity Update

The SEC’s Office of Compliance Inspections and Examinations (OCIE) has issued a risk alert providing observations derived from its “Cybersecurity Examination Initiative,” which was announced on April 15, 2014. The risk alert is based on OCIE’s examinations of the cybersecurity policies and practices of 57 registered broker-dealers and 49 registered investment advisers. In this article, SRZ partners Marc E. Elovitz and Holly H. Weiss, former SRZ partners Brian T. Daly and Robert R. Kiesel and former SRZ attorney Michael L. Yaeger discuss the risk alert, which provides fund managers with a snapshot of the cybersecurity practices of broker-dealers and investment advisers and suggests items that are of particular interest to the SEC.