SEC Watch: Monthly Takeaways For Asset Managers - December 2025

The Division of Examinations Releases Its 2026 Priorities

Summary: The SEC Division of Examinations released2026 Priorities. In the releaseannouncement, Chairman Atkins's tone marked a significant departure from prior years; describing the report as a way to "enable firms to prepare to have a constructive dialogue with SEC examiners and provide transparency," and emphasizing that examinations "should not be a 'gotcha exercise.'" A comprehensive analysis of the Priorities ishere.

Takeaway: Much of the report came as no surprise—e.g., a focus on advisers' compliance programs, an emphasis on conduct that affects retail investors, and the exclusion of crypto-assets as a priority. More interesting, however, is the Commission's tone, which conveys a desire for examinations to be a more collaborative process designed to improve compliance in a practical way. That said, the Examinations Division is large, and geographically diverse, and it can take time for changes in approach to manifest on the ground.

Best Practice Tip: While the Priorities reflect the message the Commission wants the industry to hear, the experience of going through an exam is unlikely to change materially. Registrants should work to ensure the house is in order in case Exams comes knocking and stay true to the usual script of proactive engagement with Exams Staff and swift remediation of issues identified in the course of an exam.

Enforcement Returns to Business-as-Usual

Summary: With the shutdown behind us, Enforcement has rumbled back to life. In addition to proactive outreach on ongoing investigations, the Commission has filed a number of enforcement matters, including against asset managers. In particular, on November 17, 2025the SEC announcedthe filing of six independent complaints against six investment advisers alleging material misrepresentations and unsubstantiated statements in their Forms ADV filed with the Commission. Notably, each of the advisers failed to respond to the SEC's outreach regarding the misstatements.

• TheSEC also recently announcedsettled charges against an adviser for violations of Regulation S-P, specifically, the failure to adopt reasonably designed policies, procedures, and controls regarding information security. This case aligns with the SEC's apparent focus on Regulation S-P: December 3 was the compliance date for large advisers to comply with amendments to Regulation S-P that were adopted in May 2024; the 2026 Exam Priorities specifically name Regulation S-P as a "risk area"; and the SEC is holding a series of "compliance outreach events" about the amendments, the first having been held back in September.

Takeaway: This recent enforcement activity suggests that the Commission—while re-focused on a more traditional approach to enforcement—will also continue bringing straightforward, non-fraud and non-scienter-based securities law violations.

Best Practice Tip: This Commission's emphasis on the protection of retail investors and a "back-to-basics" approach to enforcement nonetheless includes the pursuit of non-fraud and non-scienter-based offenses. Advisers should continue to maintain their compliance programs to ensure technical compliance with the rules.

A Final Death for the SolarWinds Litigation

Summary: Aftersuffering a setback last summerwhen the District Court dismissed two of three main claims in the SEC's litigation against SolarWinds and its Chief Information Security Officer, the matter was finally put to bed on November 20 when the SECfiled a joint stipulationwith the SolarWinds defendants to dismiss, with prejudice, the surviving claims. The SEC noted in its announcement that it sought the dismissal "in the exercise of its discretion" and the dismissal "does not necessarily reflect the Commission's position on any other case."

Takeaway: The dismissal of the SolarWinds litigation marks another example of the SEC unilaterally walking away from high-profile litigation authorized by the previous Commission.

Best Practice Tip: While outside of the asset management space, the Commission's dismissal of the litigation underscores the importance of constructively engaging with Staff—whether in the rulemaking, no-action, exam or enforcement context—in a manner that best aligns with the Commission's priorities.

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