New SEC office to focus on data-driven analytics

2014_08_U.S._Securities_and_Exchange_Commission_headquarters The headquarters of the SEC in northeast Washington, D.C.
Source: Wikimedia

Data-driven assessment tools will be at the center of a new office within the Securities and Exchange Commission, according to a September 11 release from the agency.

The Office of Risk Assessment, located within the Division of Economic and Risk Analysis (DERA) will coordinate the agency’s efforts to use of data tools to analyze risk and develop models to support activities across the SEC.


DERA was established in 2009 to develop risk assessment tools for the SEC and integrate financial economics and rigorous data analytics into the agency’s core mission. The agency’s website identifies the division’s mission as the SEC’s ‘think tank.’

“DERA relies on a variety of academic disciplines, quantitative and non-quantitative approaches and knowledge of market institutions and practices to help the Commission approach complex matters in a fresh light,” the website’s description says.

The Office of Risk Assessment will take that a step further, using data to improve the agency’s ability to provide more detailed assessments of risk.

“The Office of Risk Assessment will build on the existing expertise of DERA’s staff, which includes economists, accountants, analysts and attorneys, to provide sophisticated assessments of market risks,” Scott Bauguess, DERA’s deputy director, said in a statement.

The new office will be devoted to the development of tools similar to those already created under DERA. One of thosee tools, the Aberrational Performance Inquiry, led to eight enforcement actions on hedge fund corruption. The division has also previously developed broker-dealer tools to help the commission’s examiners allocate resources based on risk.


The new office will work with the SEC’s Enforcement Division’s Financial Reporting and Audit Task Force and the agency’s Division of Corporation Finance to develop a tool to assist in identifying financial reporting irregularity looking to discover potential financial fraud, according to the release. The Office of Risk Assessment will also support the agency’s work on the Financial Stability Oversight Council.

For now, the new office will be staffed by current DERA employees. The division will be on the lookout, though, for a new assistant director to lead the office.

“The establishment of this new office reflects the Commission’s ongoing focus on deploying data-driven analytics to assist in routing scarce resources to areas of the greatest risks to the market,” Bauguess said.

Bauguess and the SEC did not provide an additional comment by publication.

Jake Williams

Written by Jake Williams

Jake Williams is a Staff Reporter for FedScoop and StateScoop. At StateScoop, he covers the information technology issues and events at state and local governments across the nation. In the past, he has covered the United States Postal Service, the White House, Congress, cabinet-level departments and emerging technologies in the unmanned aircraft systems field for FedScoop. Before FedScoop, Jake was a contributing writer for Campaigns & Elections magazine. He has had work published in the Huffington Post and several regional newspapers and websites in Pennsylvania. A northeastern Pennsylvania native, Jake graduated magna cum laude from the Indiana University of Pennsylvania, or IUP, in 2014 with a bachelor's degree in journalism and a minor in political science. At IUP, Jake was the editor-in-chief of the campus newspaper, The Penn, and the president of the university chapter of the Society of Professional Journalists.

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