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SEC Exam Director to Step Down

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The head of the SEC's division that conducts examinations of investment advisors is heading back to the private sector. 

Andrew Bowden, who has headed the Office of Compliance Inspections and Examinations since June 2013, is planning to step down at the end of April, the commission announced on Tuesday.

In a statement, SEC Chair Mary Jo White praises Bowden as "a thoughtful, creative, and dedicated advocate for investors, OCIE and the commission."

"Under his leadership, OCIE has effectively engaged with investors and the industry to promote compliance, worked to detect and prevent fraud, and advised the commission on policy issues and developing risks," White adds.

An SEC spokeswoman did not immediately respond to questions about Bowden's future plans or when a successor will be named.


OCIE is familiar to many advisors for the annual guidance it has put out in recent years detailing the division's priorities as it sets out to examine RIAs, broker-dealers and other registered entities. Under Bowden's watch, OCIE identified a number of concerns in the advisor sector, including conflicts of interest, dual registrants and the quality of advice that consumers who are heading into retirement receive.

Bowden presided over the launch of the "presence exam" initiative to review new classes of advisors that were required to register with the SEC under the Dodd-Frank Act. That effort has since grown into a push to visit advisors who have never before been examined.

Last year, the SEC examined just 10% of all registered advisors, and the commission reports that 40% of advisor registrants have never been examined.

Bowden came to the commission in November 2011, starting as OCIE's national associate for the investment advisor and investment company exam program before ascending to deputy director of the division in

September 2012, and taking the top spot in the division not quite a year later.


On news of Bowden's departure, some industry observers praised his work at the commission for improving the examination regime while operating with severely limited funds.

"Four years isn't enough to make a large imprint, but I thought Drew did a lot with the limited resources available. He did what he could to step up the inspection rate of RIAs, pretty much while wearing a budget strait jacket," says Duane Thompson, senior policy analyst at fi360, a fiduciary training firm. "There was constant pressure to avoid another 'Madoff,' and there were none on that scale during his watch."

Karen Barr, president and CEO of the Investment Adviser Association, credits Bowden for marshaling technology to improve OCIE's operations, and lauds his efforts to reach out to industry members.

"OCIE achieved a new level of transparency under his leadership, not only by publishing examination priorities and risk alerts, but by sharing its observations with the public," Barr says in a statement. "Equally important, OCIE's examination program for investment advisors was improved, both in terms of the number of targeted, risk-based examinations performed and in terms of education and guidance for newly registered advisors."

Thompson echoes that view: "Coming from industry, he always tried to be transparent about OCIE's exam priorities so that compliance professionals knew what to expect when the SEC came knocking."

Kenneth Corbin is a Financial Planning contributing writer in Washington.

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