On April 7, the Securities and Exchange Commission’s (SEC) Office of Compliance Inspections and Examinations (OCIE) released a risk alert regarding Regulation Best Interest (Reg BI) and a risk alert regarding Form CRS and its related rules.

The risk alerts set forth OCIE’s expectations for compliance with Reg BI by broker-dealers and compliance with Form CRS by broker-dealers and investment advisers. The risk alerts also provide firms with information about the scope and content of OCIE’s initial examinations following the compliance date of June 30.

Initial examinations for Reg BI will focus on assessing whether broker-dealers have made a good faith effort to implement policies and procedures reasonably designed to comply with Reg BI, including the operational effectiveness of broker-dealers’ policies and procedures. Initial examinations for Form CRS will focus on assessing whether firms have made a good faith effort to implement Form CRS, including reviewing the filing and posting of a firm’s relationship summary, as well as its process for delivering the relationship summary to existing and new retail investors.

The OCIE risk alert regarding Reg BI is available here, and the OCIE risk alert regarding Form CRS is available here. More information is also available here.