It will certainly try. But the Securities and Exchange Commission is outgunned. In the extreme.
To get a feel for what the investor protection agency faces consider this: The 2020 SEC budget request was $1.7 billion. By contrast, in 2018, J.P. Morgan spent $8.8 billion on technology and communications, Morgan Stanley $2 billion and Goldman Sachs $1 billion. And this doesn’t include mutual fund behemoths like Vanguard and Blackrock with trillions under management plus hedge funds and large global players like Barclays that operate in the United States.
Money spent on technology is used to develop exotic new products and move information in ways and at speeds the SEC is challenged to understand much less regulate. It’s not because they don’t want to, and not because their people aren’t smart, but because of mismatched resources. If you believe you are protected by the SEC, that’s a fair notion, but better to operate as if you weren’t.
Sources:
MS: https://www.sec.gov/Archives/edgar/data/895421/000119312519051943/d707577d10k.htm#rom707577_26
GS: https://www.sec.gov/Archives/edgar/data/886982/000119312519050198/d669877d10k.htm#toc669877_48
SEC Budget: https://www.sec.gov/files/secfy20congbudgjust_0.pdf#page=17
