Keith Cassidy, Director of the SEC's Division of Examinations, addressed attendees at the SIFMA Compliance & Legal Society's Midwest Regional Seminar in St. Louis on June 16, 2026. In a one-on-one conversation, Cassidy reinforced the collaborative tone that has characterized the Atkins SEC and offered practical guidance on what examiners expect from registrants.
Compliance Programs Must Match the Business Model
Director Cassidy emphasized that registrants cannot outsource or contract away their core compliance obligations. A firm’s technology stack must genuinely support its business model. Examiners will test whether it does. His message was direct: do what you say you are going to do.
He encouraged registrants to be receptive, engaged, and collaborative with examination staff, and for examination staff to be mindful about how they present to registrants. This is consistent with Chair Atkins’ November 2025 statement that examinations “are an important component to accomplishing the agency’s mission, but they should not be a ‘gotcha’ exercise.”
Off-Channel Communications
Moving to specific issues, Director Cassidy’s remarks on off-channel communications were consistent with the broader direction set by Chair Atkins. The SEC’s aggressive enforcement sweep, which produced more than $2.2 billion in penalties under the prior administration, appears to have ended. The topic was absent from the 2026 Examination Priorities.
The underlying books and records obligations about off channel communications, however, have not changed. Strong compliance systems stay a priority. The Division expects to see firms showing best efforts compliance while keeping reasonable policies and procedures, not perfection.
Electronic Communications
Director Cassidy acknowledged that the tools for electronic communication are evolving rapidly. Clients expect to communicate with financial professionals in the ways they otherwise communicate, and both the examination staff and the policy divisions understand this. What the Division of Examinations learns from its work will feed into policy development at the Division of Trading and Markets and the Division of Investment Management, which will drive any changes to electronic communication rules.
Vendor Oversight
Director Cassidy also addressed third-party vendor oversight, which has become a central compliance theme in 2026. Firms must genuinely understand what their vendors are doing on their behalf, as well as what they are not doing. Gaps in vendor services can create unaddressed compliance risks.
Along these same lines, the 2026 Examination Priorities note that outsourcing arrangements present heightened risks when firms rely on external providers for critical operational functions, including recordkeeping, data migration, account-access tools, and financial reporting processes. The Division intends to evaluate how firms oversee these relationships, the sufficiency of their due diligence, and whether they support effective controls. Registrants must understand how reliance on vendors affects their risk profile and that of their customers and clients. Regulation S-P now requires firms to conduct due diligence when selecting service providers, ensure vendors can let them know within 72 hours of a suspected breach, and continuously monitor vendor compliance. Quite simply, firms “cannot contact away their obligations.”
Continued Focus on Examination Priorities
Director Cassidy signaled that artificial intelligence oversight is further along as a regulatory focus than many firms may appreciate. The Division will review the accuracy of registrant representations about their AI capabilities. Per the 2026 Priorities, examiners will focus on recent advancements in AI and assess whether firms have adequate policies and procedures to supervise their use of AI technologies for such systems as fraud prevention, back-office operations, AML, and trading functions.
Director Cassidy encouraged registrants to closely follow Chair Atkins' public statements for signals on regulatory direction. Atkins has repeatedly emphasized returning the SEC to its core mission of investor protection, fair and efficient markets, and capital formation.
The Division's priorities are likely to remain consistent going forward, depending on what the future holds. The 2026 Priorities track familiar themes: fiduciary duty, compliance program effectiveness, cybersecurity, and operational resiliency. Director Cassidy noted that pending rules are likely to be adopted on schedule.
Conclusion
Director Cassidy’s remarks reinforced a consistent theme: the Division of Examinations under Chair Atkins expects registrants to “do what they say they do,” and to show that through documented, reasonable compliance efforts. Firms that align their operations with their representations while providing evidence of good-faith oversight, including across communications, vendors, and technology, will be well-positioned for the collaborative examination process this SEC has signaled.