SEC adds advisors involved in RIA mergers to fiscal 2026 exam priority list

The SEC's Division of Examinations added advisors involved in mergers, consolidations or acquisitions to its fiscal 2026 examination priority list, Wealth Solutions Report reported on Oct. 21.

The division cited the operational and compliance complexity of those transactions and the new conflicts of interest they can create, according to the report.

Kaitlyn Wulfken, a regulatory research director at CRC Oyster, told Wealth Solutions Report that legacy billing errors, undisclosed conflicts, incomplete records, performance advertising issues and informal custody arrangements can survive a transaction. She added that a frequent blind spot is the gap between written policies and actual practice, and that buyers can underestimate client consent requirements and the compliance capacity needed to oversee a larger, more complex business.

Sander Ressler, co-owner and managing director at Essential Edge Compliance Outsourcing Services, pointed to compensation. "Anything that can put an individual's compensation ahead of their clients or the firm is problematic and should be monitored closely," he said. He added that setting clear and precise terms for each key person in an acquisition is vital.

For a seller, the same compliance items are what a buyer's diligence team will ask about, and the SEC's exam interest gives that buyer a reason to ask earlier. Fixing a legacy billing error or an informal custody arrangement before going to market is cheaper than negotiating it later.

The exam priorities cover the whole fiscal year, so a firm that signed in the third quarter sits inside the window the division has described.