SEC chief says cyber crime risks are substantial, systemic

NEW YORK (Reuters) - Regulators must do more to help mom-and-pop investors better understand the potential risks posed by cyber crime and new technologies used to commit fraud, U.S. Securities and Exchange Commission Chairman Jay Clayton said on Tuesday. 

Clayton, who was appointed to the commission earlier this year, said cyber security would be one of the top enforcement issues during his tenure at the head of Wall Street’s main regulator. 

“I am not comfortable that the American investing public understands the substantial risks that we face systemically from cyber issues,” he said during a panel discussion at New York University. “I’d like to see better disclosure around that.” 

One concern for the SEC relates to a rise in cases of information being stolen by hackers to gain some sort of market advantage, said Stephanie Avakian, co-director of the SEC’s enforcement division, who joined Clayton on the panel along with co-Director Steven Peikin. 

Other areas of focus include ensuring financial firms take the appropriate steps to safeguard sensitive information; cyber-related disclosure failures; and the growing prevalence of “initial coin offerings (ICOs),” Avakian said.  MORE