Enforcement

SEC Brings Market Manipulation Charges Over MNPI Misuse

Summary: In January 2026, the SEC filed civil charges against several individuals for an alleged insider trading and market manipulation scheme that generated tens of millions of dollars in illicit profits. The complaint alleges the defendants misappropriated confidential information, disseminated false or misleading statements to influence stock prices, and traded on material nonpublic information in violation of federal securities laws.

Why it matters: The action underscores the SEC’s continued focus on insider trading and market manipulation, particularly schemes involving misuse of confidential information and deceptive tactics that distort market prices. It reinforces regulators’ expectations around information control and market integrity.

Potential action: Firms should reassess MNPI controls, employee trading policies, and surveillance procedures, and reinforce training on insider trading and market manipulation risks. Compliance teams should ensure clear escalation and monitoring frameworks remain in place as enforcement in this area continues.

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SEC Secures Judgment in Private Fund Fraud and Misuse of Investor Funds Case

Summary: In January 2026, the U.S. District Court for the Northern District of California entered a final judgment against Bernardo Mendia-Alcaraz, his private equity firm Toltec Capital LLC, and related relief defendants in an SEC enforcement action alleging they raised about $3.3 million from investors through false and misleading statements and misused investor funds in a Ponzi-like scheme. The court permanently enjoyed the defendants from violating key anti-fraud and securities laws and barred Mendia-Alcaraz from serving as an officer or director of a public company.

Why it matters: This final judgment highlights the SEC’s continued focus on private fund fraud and enforcement of antifraud provisions across the Investment Advisers Act, Securities Act, and Exchange Act. It underscores the risks to investors and the serious legal consequences for advisers and principals who misrepresent investment opportunities or misuse investor capital.

Potential action: Advisers and compliance teams should ensure that fundraising communications are accurate, complete, and fully supported by facts, and that client assets are handled in strict accordance with fiduciary duties and regulatory requirements. Regular internal reviews of investor disclosures and controls over use of funds can help prevent conduct that could lead to similar enforcement actions.

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Rulemaking

SEC Delegates Confidential Treatment Authority to Investment Management Director

Summary: On December 31, 2025, the SEC adopted a final rule delegating authority to the Director of the Division of Investment Management to grant, deny, or revoke requests for confidential treatment of information in filings under the Investment Advisers Act. Previously, these determinations required Commission-level action. The change is intended to streamline internal processes and improve efficiency.

Why it matters: Confidential treatment requests are common for advisers seeking to protect sensitive business or proprietary information in filings such as Form ADV. Delegating this authority to the Division Director may speed review timelines and reduce procedural delays without changing substantive disclosure standards or investor protections.

Potential action: Advisers seeking confidential treatment should be aware that these decisions will now be handled at the Division level and ensure requests are clearly supported and well documented. Firms should monitor how the delegated authority is exercised, as timing and review dynamics may differ from prior Commission review.

Read More Here (Federal Register)

What regulators are saying

SEC Releases Adviser and ERA Data

Summary: The SEC makes publicly available Investment Adviser Information Reports containing data on firms that are either registered investment advisers (RIAs) or that file reports as exempt reporting advisers (ERAs). These datasets, drawn from Form ADV submissions to the Investment Adviser Registration Depository (IARD) system, include identifying information, organizational form, business activities, affiliations, custody details, disclosure items, and other key fields reported by advisers. Exempt reporting advisers, who are not fully registered but still file select ADV items, appear in a subset of the data.

Why it matters: This dataset provides the most comprehensive, structured snapshot of the U.S. investment adviser landscape available from the SEC, offering insight into adviser characteristics, registration status, and reported business activities. Market participants, compliance professionals, researchers, and regulators can use this information to benchmark industry trends, analyze adviser populations, monitor reporting obligations, and support due diligence or risk assessments.

Potential action: Advisers and service providers should become familiar with the scope and structure of the Investment Adviser Information Reports and consider how the publicly available data can inform competitive analysis, compliance benchmarking, or client intelligence. Firms that are RIAs or ERAs should also ensure timely and accurate Form ADV filings, as the underlying data feeds these public datasets. Those conducting research or analytics may wish to download the most recent ZIP files and integrate the data into internal databases or reporting tools for ongoing analysis.

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CFTC Announces New Chief of Staff

Summary: The Commodity Futures Trading Commission announced that the agency’s leadership has appointed a new Chief of Staff to support the chair’s agenda and operations. The Chief of Staff returns to the Commission with extensive prior experience at the agency and in financial services, including roles in market oversight and product deployment. The appointment comes at a time when the Commission is actively shaping policy across derivatives and digital asset markets.

Why it matters: Leadership changes at the CFTC can influence the pace and direction of regulatory priorities, including market structure initiatives, digital asset policy, and cross-agency coordination. A Chief of Staff with deep institutional knowledge may help streamline strategic execution and stakeholder engagement as the Commission navigates evolving market dynamics.

Potential action: Market participants, compliance professionals, and industry advisers should stay informed about potential shifts in CFTC focus that could arise from leadership priorities, particularly in areas such as digital asset regulation, cross-border policy, and enforcement strategy. Engaging with CFTC initiatives and monitoring public statements or rulemakings may provide early insight into regulatory emphasis.

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Events

IAA Investment Adviser Compliance Conference Returns to D.C.

Summary: The Investment Adviser Association will host its Investment Adviser Compliance Conference on March 18–20, 2026 in Washington, D.C. The conference brings together SEC staff, CCOs, legal advisers, and compliance professionals for practical discussions on current regulatory priorities and compliance best practices.

Why it matters: The event is a key forum for advisers to hear directly from regulators, stay current on exam and enforcement trends, and benchmark their compliance programs against industry standards.

Potential action: Firms should consider registering early, identifying priority sessions aligned with their regulatory focus, and using the conference to connect with peers and regulators.

Read More Here (IAA)