The Securities and Exchange Commission's visiting regulators are going to spend 2015 concentrating on the protection of retail investors from sharp practice, market-wide risks and data analysis.

A statement on the subject has come from the SEC's Office of Compliance Inspections and Examinations, whose 'examination programme' for 2015 is to focus on three areas: the need to protect the interests of retail investors; the assessment of market-wide risks; and the use of 'data analytics' to identify tell-tale signs of crime. The communique descries the investors the SEC wishes to protect as "especially those saving for or in retirement," which at first sight might suggest that any impulse the regulator may have had to protect high-net-worth investors has gone off the boil.

The 2015 examination priorities address issues that pertain to a variety of financial institutions, including investment advisors, investment companies, broker-dealers, transfer agents, clearing agencies, and national securities exchanges. In the US, 'examinations' are regulatory visits. Areas of examination include the following.

Retail investors. These are being offered products and services that were formerly characterised as alternative or institutional, including private funds, illiquid investments, and structured products. Additionally, financial service-providers are offering a broad array of information, advice, products and services to help retail investors plan for and live in retirement. The office will assess risks to retail investors that can arise from these trends.

Market-wide risks. The inspections office will be on the look-out for structural risks and trends that involve multiple firms or entire industries. It wants to monitor large broker-dealers and asset managers in coordination with the SEC’s policy divisions, conduct annual examinations of clearing agencies as required by the Dodd-Frank Act, assess cybersecurity controls across a range of firms, and examine broker-dealers’ compliance with best execution duties in routing equity order flow.

Data analytics. Analytics is the science of logical analysis. Over the last few years, the inspections office has done a lot to analyze large amounts of data well. It plans to use what it has learnt to focus on registrants and registered representatives that appear to be straying from the path of righteousness.