Welcome back to the Compliance In Context podcast! On today’s show, we do a deep dive into a brand new compliance mapping tool developed by the NSCP, review some of the exciting developments happening at the organization over the last 12 months, and preview the upcoming 2026 National Conference. In our Headlines section, the SEC recently proposes rescinding the advisor pay-to-play rule. And finally, we close up today with another installment of Outtakes, where the SEC recently sued 38 purported advisors, alleging false Form ADV filings and related disclosure issues.

Show

Headlines

• SEC Statement on Proposal to Rescind “Pay-to-Play” Rule

Interview with Melissa Loner and Heather Traeger

• Background on the NSCP Compliance Mapping Tool
• How does the new tool help compliance officers?
• Exciting developments at the NSCP from the last 12 months
• Reviewing NSCP engagement with the industry and regulators
• Implementation of the NSCP Strategic Plan
• Showcasing the 2026 NSCP National Conference
• Highlighting the year ahead

Outtakes

• SEC Sues 38 Purported Advisers, Alleging False Form ADV Filings

Quotes

10:35-11:06 – “So for those of you who don’t know, the NSCP took the charge in creating a proposal for a Compliance Advisory Committee to be permanently instilled within the SEC. And the intent of that is so that compliance professionals can give real-time live feedback to the SEC in regard to proposals, rules, implementation, things that they’re thinking about, educational opportunities, directly from the compliance professionals that are affected by those items every day.” – Melissa

17:16-17:42 – “Sometimes it’s about innovation and reinventing, and a lot of these listening tours have told us that, you know, we’re doing things, and we’re doing them well. As Heather pointed out, our biggest differentiator is we are for the individual compliance professional, and to be able to give them real takeaways that help them do their job every day, but also to evolve in their professional development. And so we wanted to make sure that we weren’t losing our roots.” – Melissa

25:26-26:01 – “The concept is that it would give the SEC direct access to, you know, the practical perspective of those who are responsible for making regulatory requirements work in real-world environments. I mean, better implementation begins with better understanding, and so the comment letter process, as we all know, it happens, you know, once the proposal is out the door, and this is a mechanism that’s earlier and more effective regulatory engagement.” – Heather

32:42-33:15 – “This allows you, at the National Conference, to hear from so many different perspectives and experiences in one place in three days. This is one that, you know, our team- everybody’s got their hand up to come to this conference because they are looking to get that information. And because there’s multiple tracks, you know, we send as many people as we can so that we can hear from all these different speakers.” – Heather

Welcome back to the Compliance In Context podcast! On today’s show, we dive into the conversation on how firms continue to develop legal practitioners and compliance officers in an AI era. In our Headlines section, the SEC Establishes a Financial Reporting and Accounting Unit Within Division of Enforcement and the SEC’s RegFlex Agenda SEC Agenda Targets Crypto, Climate Rescission, Treasury Clearing, and finally, we close up today with another installment of What’s On My Mind, where we review a recent quote from a track coach on how we can push our compliance colleagues to become the best versions of themselves.

Show

Headlines

• SEC Establishes Financial Reporting and Accounting Unit Within Division of Enforcement
• SEC Agenda Targets Crypto, Climate Rescission, Treasury Clearing

Interview with Kurt Wachholz

• Reviewing the University of Chicago Law School’s statement on education in the AI Era
• How should firms adapt its training and policies in response to AI?
• How can we as compliance professionals develop an AI-resilient pedagogy and assessment?
• What are the “essential human” skills that distinguish excellent compliance professionals?
• How should firms instruct the responsible, effective, and ethical use of AI?
• What are some techniques firms can employ to foster an active, in-person engagement of compliance experiences that are conducive to learning?
• What can firms do avoid a reliance on technology while still highlighting and enhancing the output of AI tools for compliance purposes?

What’s On My Mind

• A lesson from a track coach on the true definition of winning and becoming the best versions of ourselves

Quotes

19:56 – “We had them all present to the rest of the class, and the class judged everyone's presentation, the rationale, who they selected, why they selected, all that good stuff. We get done with the assignment, and I'm going up to tell everyone who won, because they all had to turn in who they thought did the best presentation. And what I said to them is, ‘You all failed the assignment.’ And they just couldn't believe it. It's like, ‘What do you mean we failed the assignment?’ I said, ‘Because what you all decided when you were given this was that you had to make a choice with what you were given.’ And so, the part we were trying to help them with was, nobody questioned the exercise. They tried to fit the exercise around what they were told to do. So what I was trying to help them with, especially when we think about ethics and things of that nature, sometimes you have to question the premise before you go to the answer. And so I thought that one of the things that was really helpful about that exercise is that your reasoning doesn't start with your choices; it starts with the premise for it. I think that really relates to AI. A lot of times, we're going to be thinking about what's the output and is it acceptable, versus what did we start with in the first place as to why we used the tool.” - Kurt

34:49 – “Experience is not just accumulating answers. Going through an exam and responding to the request didn't necessarily give me experience. What it gave me was an identity of, like, this means that this is the production of what something is being asked to produce. But it wasn't actually helping me learn how to think. It was helping me learn how to deliver.” - Kurt

42:45 – “Knowing the right answer is not the same as being able to produce the right outcome. Knowing we're doing something wrong isn't what you're winning. It's getting the right outcome from knowing that; that really matters to the business. How we give voice to a concern can determine whether that concern is even meaningful.” - Kurt

49:36 – “Finding the...

Welcome back to the Compliance In Context podcast! On today’s show, we will be providing a comprehensive, deep-dive look at Ponzi schemes—what are they, historical facts and impact, themes and trends, and some best practices to keep in mind to help prevent these types of frauds from occurring inside your firms and with any underlying clients. To help guide us through this important topic and share some fantastic insights for our listeners, we welcome in Daniel Brinks, a Partner with StoneTurn and former regulator who spent more than 15 years at the SEC, most recently serving as a forensic account in the SEC’s Division of Enforcement..

Show

Interview with Daniel Brinks

• Background on Ponzi Schemes
• What are the trends and are there early-detection red flags?
• Why do some fall apart at 18 months versus others that last 10 years?
• How do the feeder frauds operate?
• Why do Ponzi schemes have an air of legitimacy?
• What are the similar characteristics in Ponzi Schemes?
• Custody Rule Impact
• Why has the total number of Ponzi schemes declined in recent years?
• How do compliance officers make sure to prevent these frauds from occuring?

Quotes

05:39: “So his scheme lasted eight months. He raised, you know, $20 million. But I think that the hallmarks of his scheme are still the hallmarks of what we see today. So the hallmarks of the original Ponzi scheme, a promise of high return, low risk…an exotic investment strategy, then the theft of assets, fake account statements. And I think the hallmark of a true Ponzi scheme is the recycling of assets, where you're using the investments of new investors to meet redemption requests from prior investors.” – Daniel Brinks

08:53: “I think the unfortunate and sad truth is that most Ponzi schemes are only uncovered when investors start bringing them to the attention of regulators. So the SEC has a TCR system, and when investors can't get their money back from schemers, they start reporting, 'Where's my money?' And then the SEC starts investigating it. That's unfortunately how most of these schemes fall apart, when they can no longer meet redemption requests and people start making complaints.” – Daniel Brinks

13:44: “I think the two characteristics that exist that investors and investment advisors should be on the lookout for the most is lack of transparency…the hard to get real answers on pieces of paper, statements. Think about as a scheme grows from ten investors to 100 or 200 investors, now you're sending quarterly statements to 200 investors. Like, that's a big administrative lift that probably most schemers don't have the ability to come up with rational answers for, where you're manufacturing complete trading histories that tie out, you know, multiple sets of books. It's really complicated to have multiple sets of books. So when schemes seem to get outside the realm of what people can do easily, information gets harder and harder to come by, and people should take that as a real warning flag when they're not getting, you know, account statements and things like that, or if the account statements look weird, right? They don’t look exactly what you would expect they would look like from a core custodian.” – Daniel Brinks

17:49: “I think another explanation for why [Ponzi schemes have declined] could be because we've generally been in a strong economic cycle. So, economic recessions cause increased numbers of redemption requests, and that puts a lot of pressure on the fund, and it makes them harder to ma- make, to meet those redemption requests. And that's when, whenever there's a recession, we see the number of Ponzi schemes that are prosecuted spike almost immediately. And I think the current strong economic cycle kind of has allowed frauds to go under the radar.”