5 big wealth management regulatory trends in 2024

For wealth managers who think regulators have been a tad overbearing for the past few years, the end of 2024 is likely bringing a sigh of relief.

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Securities Exchange Commission Chair Gary Gensler capped off his momentous run as Wall Street’s top watchdog with the biggest penalty haul in the agency’s history. The SEC reported in November that it brought in a record $8.2 billion in financial remedies in its previous fiscal year.

As had previously been the case, much of the haul came from enforcement actions against cryptocurrency firms. In fact, in the SEC’s fiscal 2024, a full $4.5 billion came from regulators’ case against Terraform Labs, a now defunct cryptocurrency firm, and its founder, Do Kwon. 

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But crypto was far from the only story. Regulators pursued cases cracking down on alleged bogus claims about artificial intelligence and similar technologies and firms’ failures to track and record their advisors’ business-related communications. Plaintiffs lawyers also stayed busy filing cases accusing firms of doing too little to protect elderly clients from fraud and to make sure investors are receiving fair returns on cash held in “sweeps” accounts. 

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Amid it all, serious questions have arisen over whether regulators have at times been overstepping their remit. A milestone Supreme Court case greatly curtailed the SEC’s ability to handle disciplinary cases internally without having recourse to the court system. Building on that decision, a series of other cases seek to undermine the very foundations of the Financial Industry Regulatory Authority, the broker-dealer industry’s self-appointed regulator.

With Donald Trump returning to The White House next month, expectations are that deregulation will be the order of the day. But before coming to that point, it’s worth taking a look back at what regulators did in the previous year. 

Scroll down for our list of some of the biggest cases and trends affecting wealth management regulation in 2024.AI-washing, elder fraud, reg rollback: 5 big compliance trends in 2024