SEC Chair White Breaks Down FY 2017 Budget Request (with Delta Strategy Group Summary)

SEC Chair Mary Jo White called on the Senate Appropriations Committee to approve President Obama's SEC $1.781 billion FY 2017 budget request.

Chair White outlined the SEC's "great strides" over the past few years in (i) strengthening operations and programs, (ii) adopting strong measures to protect investors and markets, and (iii) enforcing securities laws to punish wrongdoers.

Chair White broke down the SEC FY 2017 budget request into the following categories:

• Examination. In order to increase the number of examinations of investment advisers, as well as other key entities that interact with retail and institutional investors, the SEC requested 127 additional examiners.

• Technology. The SEC requested eight new positions in the Office of Information Technology in order to modernize key information technology initiatives, which included (i) expanding data analytic tools, (ii) increasing information security, (iii) redesigning the Electronic Data Gathering, Analysis and Retrieval system, (iv) improving examination through risk assessment and surveillance tools, (v) enhancing the Tips, Complaints and Referral System, (vi) improving enforcement investigation and litigation tracking, (vii) modernizing SEC.gov, and (viii) investing in further business process automation and improvements.

• Enforcement. In order to enhance the investigation and litigation capabilities of its enforcement program, the SEC requested that the following positions be added: (i) 30 experienced forensic accountants, attorneys, industry experts and information technology and support staff members, (ii) 12 experienced trial attorneys, (iii) 5 data analytics experts, and (iv) 5 intelligence functions staff members.

• Division of Economic and Risk Analysis. The SEC requested six new staff positions in areas that included exchange-traded funds, microcap stocks, the derivatives markets and asset-backed securities.

• Division of Trading and Markets. The SEC requested seven additional staff positions, three of which would assist the Division in implementing new or enhanced responsibilities in clearing agency and swap data repository oversight. The remaining four would (i) help to improve the SEC's analytics and reporting on broker-dealers' finances, internal controls and risk management practices, (ii) process rule proposals from a growing number of SROs, and (iii) provide interpretive guidance related to the derivatives markets.

• Division of Investment Management. The SEC requested seven new positions in order to (i) conduct data analysis, particularly when it is part of the investment company reporting modernization initiative, (ii) monitor issues related to asset management risks (including those that are related to liquidity, derivatives, stress testing and transition planning rulemaking initiatives), (iii) provide interpretive advice, and (iv) respond to exemptive applications.