The SEC’s 2026 exam priorities are out, and for registered investment advisers (RIAs), a clear theme emerges: mergers and acquisitions matter more than ever. As consolidation in the advisory industry continues at a record pace, the SEC is signaling that recently merged or acquired RIAs could face heightened scrutiny. If your firm has recently joined forces with another practice, or if you’re planning an expansion through acquisition, understanding these priorities can help you prepare, stay compliant, and engage constructively with examiners. 

Why M&A Is on the SEC’s Radar 

The SEC’s Division of Examinations highlighted advisory firms that have “merged or consolidated with, or been acquired by, existing advisory practices” as a source of potential risk. Operational and compliance complexities often accompany mergers: blended governance structures, conflicts of interest, and changes in investment processes or vendor relationships. The 2026 priorities letter marks a notable shift, with Mergers & Acquisitions (M&A) flagged as a focal area after years of less emphasis in this category. 

Key takeaways: 

• M&A activity can introduce new conflicts of interest and operational challenges. 

• Examiners will assess whether the aftermath of a merger aligns with fiduciary duties and client interests. 

• Newly formed or newly registered RIAs may face additional scrutiny as they navigate integration workflows. 

• The SEC will continue prioritizing RIAs that have never been examined. 

Core Focus Areas for 2026 Examinations 

Beyond M&A, the SEC’s priorities remain anchored in protecting retail investors and ensuring compliance with core standards. Expect a careful review of the following: 

Retail Investor Protection and Fiduciary Obligations 

• Adherence to Regulation Best Interest (Reg BI) requirements. 

• Clear and compliant fiduciary duties in recommendations to clients. 

• Transparency around conflicts of interest and the rationale behind product and account-type recommendations. 

Conflicts and Cost Considerations 

• Scrutiny of financial conflicts of interest, including how cost, investment objectives, risk, and volatility influence recommendations. 

• Extra attention to investment strategies that may be high-cost or complex, particularly for elderly clients. 

• Evaluation of the appropriateness of alternatives and high-cost investments in client portfolios. 

Privacy & Protection of Client Information 

• Expect review of written incident-response programs and strengthened safeguards for client information. 

• Examiners will look for timely breach notifications and effective oversight of service providers. 

• Recently merged RIAs may face added scrutiny due to integration-related cybersecurity and data-handling risks. 

Complex and Non-Traditional Investment Vehicles 

• Scrutinizing the use of alternative investments and high-cost strategies. 

• Close examination of products such as ETF wrappers on illiquid underlying strategies, option-based ETFs, leveraged ETFs, and inverse ETFs. 

Third-Party Access and Control 

• Increased focus on cases where advisors use third parties to access client accounts, with emphasis on security and oversight. 

Dual Registrations and Incentives 

• Continued attention to dually registered RIAs and broker-dealer arrangements. 

• Extra care with advisory representatives who are also registered representatives and may face incentives that could create conflicts. 

Practical Steps for RIAs Today 

If your firm is navigating an M&A event or wants to proactively align with the 2026 priorities, consider these steps: 

• Conduct a pre-merger risk assessment 

• Map out governance, policies, and control environments for both legacy entities. 

• Identify potential conflicts of interest arising from the merger and establish mitigations. 

• Revisit client disclosures and communications 

• Ensure all disclosures reflect the merged structure, ongoing fiduciary obligations, and any changes in investment objectives or fees. 

• Update SOAs, client agreements, and Form ADV where needed to avoid gaps. 

• Strengthen governance and oversight 

• Harmonize compliance programs, risk management, and vendor oversight across the combined organization. 

• Implement cross-firm training on Reg BI, fiduciary duties, and conflicts management. 

• Review compensation and incentives 

• Assess whether compensation structures could create conflicts of interest post-merger. 

• Ensure disclosures and practices align with regulatory expectations for dual registrations and incentive models. 

• Enhance transparency with clients 

• Provide clear explanations of how the merger affects investment strategies, costs, and account handling. 

• Maintain accessible channels for client questions and concerns during the transition. 

• Prepare for exams 

• Run internal mock exams focused on M&A-related scenarios, Reg BI, elderly client suitability, and use of complex products. 

• Document decision processes and rationale for recommendations, especially for contentious or high-risk investments. 

The Bigger Picture—What the 2026 Plan Signals 

The SEC’s shift to explicitly flag M&A as a potential risk signal suggests a mature emphasis on how consolidation affects client outcomes and compliance posture. Chairman Paul S. Atkins emphasized constructive dialogue with examiners, underscoring that examinations should inform improvements rather than be a “gotcha” exercise. For RIAs, the message is clear: be deliberate, transparent, and proactive in addressing how mergers shape risk, conflicts, and fiduciary duties. 

Additionally, the 2026 priorities maintain a broad focus on protecting retail investors, while also noting that the crypto-assets risk assessment observed previously has been removed. This aligns with a certain regulatory posture: stable, investable, and transparent product considerations remain central to client welfare. 

Turning Priorities into Practice 

The 2026 SEC exam priorities underscore a practical reality for RIAs: mergers matter, conflicts matter, and the goal is transparent, client-centric advisory. By preparing for M&A-related scrutiny, reinforcing fiduciary protections, and maintaining clear, holistic risk management, advisory firms can navigate exams with confidence and continue delivering value to clients in a rapidly evolving advisory landscape.