SEC Priority Open Recommendations

This letter to the Securities and Exchange Commission outlines one open recommendation that it should prioritize. For example, recent bankruptcies and fraud involving blockchain-related products and services—e.g., cryptocurrencies—raised concerns about consumer risk. SEC and the other financial regulators should coordinate how they identify and address such risk.

What GAO Found

In June 2022, GAO identified three priority recommendations for the Securities and Exchange Commission (SEC), which related to SEC’s oversight of the Financial Industry Regulatory Authority, Inc. (FINRA). Since then, SEC has implemented all three priority recommendations. Specifically, SEC has adopted performance measures to help assess the effectiveness of its oversight of FINRA as well as policies and procedures to identify, communicate, and monitor significant findings from its inspections and examinations of FINRA.

As of June 2023, GAO identified one new priority recommendation for SEC, which calls for developing a coordination mechanism with the other federal financial regulators for identifying and addressing blockchain risks. A formal mechanism with established processes and time frames could help the federal financial regulators collectively identify blockchain risks and develop timely and appropriate responses.

See the notice here.

🔊 Listen to Story