Staying Ahead of the Curve: 2025 Regulatory Exam Priorities for Financial Services Compliance Teams

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We know you’ve seen the SEC and FINRA’s latest exam priorities—after all, staying informed is what you do. But between managing daily compliance challenges, overseeing risk, and putting out fires, finding the time to break down these priorities and develop a strategy can be overwhelming. That’s where we come in. We’re here to help distill the key takeaways so you can focus on what truly matters—keeping your firm ahead of the curve and out of regulators’ crosshairs.

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To help you stay proactive, we’ve summarized the most critical areas of focus from both the SEC and FINRA for 2025, along with actionable steps to strengthen your compliance program.

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SEC’s 2025 Examination Priorities

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The SEC’s priorities continue to reflect its investor protection mandate, with an emphasis on fiduciary duties, cybersecurity, and emerging technologies.

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1. Fiduciary Duty and Standards of Conduct

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Expect the SEC to scrutinize whether investment advisers and broker-dealers are upholding their fiduciary responsibilities under Regulation Best Interest (Reg BI) and the Investment Advisers Act. Firms should be prepared to demonstrate:

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• Clear documentation of recommendations: Ensure that investment recommendations and advice are backed by thorough due diligence and a well-documented process.
• Robust conflicts of interest mitigation: Review and update policies to address potential conflicts—especially those tied to revenue-sharing agreements and proprietary products.
• Effective customer disclosures: Refine your firm’s disclosure practices to ensure clients fully understand fees, risks, and potential conflicts.

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2. Cybersecurity and Operational Resilience

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Cyber threats are evolving rapidly, and regulators are doubling down on enforcement in this area. The SEC wants to see that firms are:

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• Conducting regular cybersecurity risk assessments: Identify vulnerabilities and test incident response plans through routine tabletop exercises.
• Enforcing strict access controls: Ensure multi-factor authentication (MFA), least-privilege access policies, and vendor risk management protocols are in place.
• Demonstrating rapid response capabilities: The SEC will scrutinize firms' ability to detect, respond to, and recover from cyber incidents in real time.

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3. Emerging Technologies and Crypto Assets

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With the rapid growth of digital assets and AI-driven investment tools, firms leveraging new technologies should expect heightened scrutiny. Compliance teams should:

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• Ensure crypto-related activities align with regulatory frameworks: The SEC is targeting misleading marketing, inadequate risk disclosures, and compliance gaps in crypto custody.
• Implement AI and algorithmic trading governance: Firms using AI for trading or investment decision-making should have documented oversight processes to prevent bias and market manipulation.
• Enhance compliance monitoring for digital assets: Make sure crypto-related communications, disclosures, and investor suitability assessments align with SEC guidance.

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FINRA’s 2025 Regulatory Oversight Focus

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FINRA continues to emphasize market integrity and investor protection, with particular attention to trading practices, execution quality, and customer disclosures.

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1. Manipulative Trading Practices

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FINRA will aggressively pursue firms engaging in—or failing to prevent—manipulative trading schemes such as spoofing, layering, and pump-and-dump tactics. Firms should:

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• Enhance trade surveillance systems: Ensure surveillance tools are robust enough to detect real-time manipulative trading patterns.
• Train staff on manipulative trading red flags: Ensure your traders, compliance teams, and supervisors understand the latest tactics and how to detect them.
• Bolster oversight of high-risk accounts: Pay special attention to accounts engaging in high-volume, high-frequency, or suspicious trading behavior.

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2. Best Execution Obligations

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FINRA is closely reviewing how firms execute trades and whether they are prioritizing customer interests. Compliance teams should:

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• Review execution quality reports: Regularly analyze execution quality metrics to ensure best execution obligations are met.
• Strengthen oversight of order routing practices: Evaluate whether routing decisions are driven by execution quality or payment-for-order-flow incentives.
• Document best execution reviews: Maintain comprehensive records showing how your firm assesses and ensures best execution for clients.

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3. Customer Disclosures Related to Overnight Trading

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With market volatility on the rise, FINRA is focusing on whether firms provide adequate disclosures about the risks associated with overnight trading. To stay compliant:

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• Update customer risk disclosures: Ensure clients receive clear, comprehensive explanations of overnight trading risks.
• Implement enhanced suitability reviews: Assess whether customers engaging in overnight trading fully understand the associated risks and are suited for such strategies.
• Monitor margin and leverage risks: Strengthen risk controls for margin accounts with overnight positions to prevent excessive leverage exposure.

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Key Takeaways for Compliance and Risk Management Teams

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To stay ahead of regulators in 2025, compliance leaders must continue driving a more proactive approach. By anticipating risks, leveraging intelligent compliance technology, and embedding risk management into daily operations, they can stay ahead of evolving regulations with confidence.

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✅ Supercharge Cybersecurity Readiness

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• Conduct quarterly cyber risk assessments and real-time breach simulations.
• Ensure your incident response playbook is up-to-date and tested.
• Implement continuous threat monitoring to detect vulnerabilities before regulators do.

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✅ Tighten Trade Surveillance & Market Conduct Oversight

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• Upgrade trade surveillance systems to detect manipulative trading before FINRA does.
• Develop automated alert systems to flag suspicious patterns in real time.
• Conduct ongoing staff training to ensure vigilance against evolving market manipulation tactics.

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✅ Enhance Disclosure Practices & Customer Protections

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• Simplify and clarify fee structures, removing gray areas that may trigger regulatory scrutiny.
• Develop interactive risk disclosure tools to help clients understand investment risks transparently.
• Implement real-time monitoring of order execution quality to ensure fairness.

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✅ Leverage Intelligent Compliance Technology

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Compliance teams are stretched thin—yet the demands only keep increasing. The most effective way to meet regulators' expectations while reducing operational strain is by leveraging AI-driven compliance monitoring, automated trade surveillance, and enhanced reporting tools.

By integrating advanced compliance technology, firms can improve accuracy, reduce human error, and stay ahead of regulatory expectations—without overwhelming already-burdened teams.

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The Bottom Line

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You know regulators aren’t slowing down, nor should your compliance program. By prioritizing cybersecurity, best execution, market integrity, and investor protection, firms can position themselves for a smoother 2025. Staying ahead requires the right strategy, strong controls, and intelligent technology—because, in today’s regulatory landscape, compliance isn’t about reacting; it’s about leading. Firms that continue to push towards a more proactive approach will not only meet expectations but also set the standard for the industry.

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