SEC Withdraws 14 Biden-Era Proposed Investment Adviser Rules

The Securities and Exchange Commission (SEC), under Chair Paul Atkins appointed by President Donald Trump, has withdrawn 14 major proposed rules and amendments introduced between 2020 and 2023 during the Biden administration. These proposals covered areas including cybersecurity risk management, environmental, social, and governance (ESG) disclosures, safeguarding client assets under the custody rule, outsourcing by investment advisers, conflicts of interest related to predictive data analytics, shareholder proposal rules, and best execution standards for brokers. The SEC did not provide detailed reasoning for each withdrawal but cited a broad strategic shift in regulatory priorities and indicated that any future regulatory actions in these areas would be pursued through new proposed rules consistent with the Administrative Procedure Act. Industry groups and financial service firms have welcomed the withdrawals as relief from what they considered overly burdensome and duplicative compliance requirements. The SEC also announced leadership changes, including the appointment of Brian Daly as director of the Division of Investment Management. This regulatory pivot marks a clear departure from the previous aggressive agenda under former Chair Gary Gensler.