“Technology is rapidly changing the way investment advisors are able to advertise and deliver their services to clients,” said C. Dabney O’Riordan, chief of the SEC Enforcement Division’s Asset Management Unit. “Regardless of their format, however, all advisors must take seriously their obligations to comply with the securities laws, which were put in place to protect investors.”
The SEC has issued a bulletin through the Office of Investor Education and Advocacy that contains additional information about robo-advisors.
Zach Schapiro, research analyst for Backend Benchmarking, an analyst organization, and publisher of The Robo Report, said, "As robos roll out more ambitious technical features, there can be unintended consequences. It is paramount that these features are not misrepresented to investors. Today's actions illustrate the SEC's ongoing commitment to transparency and accountability to protech investors on these nascent platforms as regulations catch up to these new features."