Enforcement Trends: More Supervision, Less Surprise
While regulatory tone may be shifting under new SEC leadership, enforcement activity remains robust — but also more strategic. In the Q2 2025 Regulatory Roundup webinar, panelists from Eversheds Sutherland highlighted a continued focus on communications oversight, with enforcement actions increasingly bundled with broader violations. From influencer marketing to recordkeeping failures and safeguarding customer data, the message is clear: implementation and accountability are the new front lines of compliance.
Why it matters
Gone are the days of standalone off-channel communication fines. Regulators are looking deeper, connecting policy failures to broader supervision and risk control gaps. The evolution signals a compliance expectation that goes beyond having policies “on paper.” Instead, regulators are assessing how firms enforce, monitor, and document adherence.
This quarter’s actions reveal an increasing emphasis on individual accountability, supervisory execution, and how firms identify and respond to lapses across communication channels.
Recent enforcement actions
Firms can get a sense of what to expect looking at recent regulatory actions:
- FINRA fined one firm $1.6 million for multiple violations, including exaggerated influencer promotions, Form CRS lapses, and supervisory deficiencies
- Another firm was fined $350,000 for similar issues involving paid influencers and weak content review practices
- A third firm was fined $275,000 (plus $750,000 in disgorgement) for order handling violations and failure to archive Bloomberg messages — only discovered after a FINRA inquiry
- Two individuals faced enforcement:
- One was barred for using unapproved channels and failing to disclose private securities transactions
- Another received a $5,000 fine and a one-month suspension for using WeChat to discuss trading and compliance matters
- Safeguarding lapses also appeared: One firm was fined $125,000 for failing to cut access to customer accounts after reps departed
"Regulators are looking beyond written policies. Implementation, monitoring, and enforcement of supervision programs are now central to compliance expectations."
What to watch
These enforcement actions suggest firms should:
- Continue to prioritize communications, recordkeeping, and supervisory controls
- Recognize that FINRA increasingly targets multi-violation cases, especially where digital communication governance and archiving issues reflect wider compliance failures
- Firms should evaluate digital communications supervision across channels, user groups, and regions, ensuring no gaps in policy coverage or technical control
How Smarsh can help
This quarter’s enforcement activity reinforces an ongoing evolution: regulators are not just policing communications in isolation — they’re scrutinizing the entire compliance infrastructure behind them. Supervision, documentation, and execution are now inseparable from the policies themselves.
"We don’t expect to see standalone [recordkeeping] cases... but we do expect them to bring some where there are other violations."
For compliance leaders, the takeaway is clear: it's not enough to have a policy against off-channel communications or an influencer disclosure checklist. Firms must be able to show how those expectations are communicated, enforced, and monitored in real time across increasingly complex digital environments.
That makes visibility across communication channels more than a technical challenge — it’s a supervisory imperative. At Smarsh, we help firms simplify communications. Our solutions are designed to capture the most common (and several uncommon) communication channels. By expanding the number of channels that can be captured, Smarsh empowers your organization to allow more channels and minimize the risk of off-channel communications.
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