The tool will enable members of the public to check if the person trying to sell them investments has a judgement or order against them as part of an enforcement action.
Called the SEC Action Lookup for Individuals (Sali), it will help identify registered and unregistered individuals who have been involved in SEC enforcement actions and against whom federal courts have entered judgments or the SEC has issued orders.
It is not limited to registered investment professionals, as with many existing online search functions, the US watchdog said.
Instead, Sali allows the public to identify individuals who have settled, defaulted, or contested an enforcement action brought by the SEC, provided that a final judgment or order was entered against them in a federal court or an administrative proceeding.
It will currently provide details of parties included in SEC actions filed between October 2014 and March 2018.
Over time, the search feature will be updated to include actions prior to October 2014.
Key line of defence
“Our main street Investors themselves are a key line of defence in detecting and preventing fraud said SEC chairman Jay Clayton.
“One of the SEC’s most important tasks is to arm our investors with the tools necessary to identify potential fraudsters. An important risk factor is whether the person you are dealing with has a disciplinary history with the SEC or other regulators.
“Sali provides main street investors with an additional tool they can use to protect themselves from being victims of fraud and other misconduct,” Clayton said.
