Securities and Exchange Commission, Office of Compliance and Examinations 2018-02-20T13:03:57+00:00

Project Description

Rob Lopata, ERPi Manager

Rob Lopata

Senior Manager

Securities and Exchange Commission, Office of Compliance and Examinations

The Office of Compliance Inspections and Examinations (OCIE) was created to administer the SEC’s nationwide examination and inspection program, also referred to as the National Examination Program (NEP). The NEP’s mission is to protect investors, ensure market integrity and support responsible capital formation through risk-focused strategies that: (1) improve compliance; (2) prevent fraud; (3) monitor risk; and (4) inform policy. SEC uses the results of the NEP’s examinations to inform rule-making initiatives, identify and monitor risks, improve industry practices and pursue misconduct.

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 significantly expanded the SEC’s exam responsibilities, which were further complicated due to the continual growth in the number and complexity of SEC registered entities. As a result, in September 2015, OCIE launched a Resource Optimization Study (ROS) and commissioned ERPi to provide advice and recommendations to OCIE senior management on improvements that would optimize its limited resources to increase efficiency and effectiveness.

Over a 15-month period, my team and I gathered data that included conducting interviews across the country with NEP examiners, exam managers, assistant regional directors, associate regional directors, regional directors, and national leadership as well as an assessment of the NEP’s tools, technologies, and methodologies; analyzing SEC/NEP strengths, weaknesses, and trends; and developing 20 recommendations, organized into four central themes.

Why This Work Matters

The four themes and their associated 20 recommendations are targeted at improving efficiency and effectiveness in the examination program with the goal of completing more high-quality exams. While most recommendations include changes to policies, processes and tools, there is an intangible, but critical element to each as well — organizational acceptance and the extent to which the organization can engage in changes that may produce the desired short and long-term enhancements for the NEP.

The critical mission of protecting investors and market integrity is incredibly complex. The registrant population that the SEC oversees is continuously growing at a rate that far outpaces the amount of resources allocated to serve the mission. To put this in perspective, the SEC FY17 operating budget was $1.7 billion as compared to the $67 trillion it was responsible for overseeing. The SEC is continuously improving to do more with less and we are very proud of the work we did to help the agency achieve their goals.

Making a Difference

My team and I had the wonderful opportunity to meet with exceptional members of the NEP throughout the country. In each office, the passion to protect investors from fraudulent investments was resounding and contagious. The information we learned directly from the people who are executing this mission daily was invaluable and heavily influenced the final 20 recommendations. Helping to protect America’s financial future was a tremendous opportunity and experience for all of us at ERPi and we look forward to future opportunities at OCIE and the SEC.