The U.S. Securities and Exchange Commission’s (SEC) on Monday announced the launch of a new unit to combat cyber attacks, along with an initiative to better protect retail investors.
The new initiatives reflect Chairman Jay Clayton’s priorities, the SEC says in its announcement.
A dedicated new Cyber Unit, launched by the SEC’s enforcement division “will focus on targeting cyber-related misconduct.”
At the same time, the regulator is setting up a Retail Strategy Task Force to address issues that primarily impact retail investors.
The new Cyber Unit will tackle a wide range of online threats, including: market manipulation schemes; hacking to obtain inside information; misconduct on the dark web; intrusions into retail brokerage accounts; online attacks on trading platforms and components of market infrastructure; and violations involving distributed ledger technology and initial coin offerings.
“Cyber-related threats and misconduct are among the greatest risks facing investors and the securities industry,” saya Stephanie Avakian, co-director of the SEC’s enforcement division, in a statement. “The Cyber Unit will enhance our ability to detect and investigate cyber threats through increasing expertise in an area of critical national importance.”
Retail Strategy Task Force
The Retail Strategy Task Force will develop “targeted initiatives to identify misconduct impacting retail investors,” ranging from unsuitable product sales to microcap pump-and-dump schemes. The task force will apply the lessons learned from those cases, the SEC announcement says, and use analytics and technology to identify major misconduct affecting retail investors.
“Protecting the welfare of the Main Street investor has long been a priority for the commission. By dedicating additional resources and expertise to developing strategies to address misconduct that victimizes retail investors, the division will better protect our most vulnerable market participants,” says Steven Peikin, co-director of the SEC’s enforcement division, in a statement.