The SEC on Monday announced a $1.658 billion budget request for fiscal year 2019 starting in October—a 3.5 percent increase over the fiscal year 2018 budget.
In its new budget plan, the SEC proposed spending more on technology, cybersecurity, enforcement and examinations.
The request said funding has been flat since fiscal year 2016 and, with a hiring freeze begun in fiscal 2017, staffing has been dropping due to attrition. About 100 additional positions would be added under the plan—a quarter of the positions lost in the hiring freeze—bringing total employees up to 4,628.
The SEC’s funding comes from fees on securities transactions.
Under the new budget, 17 positions would be given to the division of enforcement, and 24 positions to the office of compliance, inspections and examinations (OCIE). Of those 24 additional OCIE positions, 13 would be dedicated to investment advisor exams.
The SEC said it examined about 15 percent of registered investment advisers in fiscal year 2017, but that nearly 35 percent of all RIAs have never been examined.
One new requested position is for an ETF industry professional who “would evaluate novel and complex ETF products.” Another two positions would formulate policy with respect to issues involving the impact of new technologies on investment managers and advisors, including “the emergence of roboadvice," the SEC said.
The SEC is also fighting to keep a reserve fund created under Dodd-Frank, which allows the agency to put up to $50 million a year into the fund for use on longer-term projects such as technology.
The Trump administration and Republicans in Congress have proposed eliminating the fund.