The rise of digital fraud and financial cybercrime has
prompted the Securities and Exchange Commission (SEC) to take decisive action. The agency announced the formation of the Cyber and Emerging
Technologies Unit (CETU), a specialized task force designed to crack down on
cyber-related misconduct and protect retail investors from evolving digital
threats.

“The unit will not only protect investors but will also
facilitate capital formation and market efficiency by clearing the way for
innovation to grow. It will root out those seeking to misuse innovation to harm
investors and diminish confidence in new technologies,” said Acting Chairman
Mark Uyeda.

New Exec Appointed to Lead the New Unit

Laura D’Allaird will lead the new division, which replaces
the former Crypto Assets and Cyber Unit. The CETU consists of approximately 30 fraud specialists and
attorneys spread across SEC offices.

“Under Laura’s leadership, this new unit will complement the
work of the Crypto Task Force led by Commissioner Hester Peirce. Importantly,
the new unit will also allow the SEC to deploy enforcement resources
judiciously,” added Uyeda.

Its mission includes identifying and eliminating cyber
threats that exploit emerging technologies such as artificial intelligence and
blockchain. According to Acting Chairman Mark T. Uyeda, the unit will play a
critical role in enforcing regulations while fostering market confidence.

The CETU’s enforcement priorities span several aspects of
cyber-related misconduct, including fraud involving artificial intelligence
and machine learning, the use of social media, the dark web, and fake websites
for fraudulent schemes.

SEC Strengthens Enforcement as Digital Threats Evolve

Hacking attempts to access nonpublic financial information,
unauthorized takeovers of retail brokerage accounts, fraud in blockchain
technology and crypto assets, compliance failures in cybersecurity regulations
among regulated entities, and false or misleading disclosures about
cybersecurity risks from public companies

The rapid adoption of emerging financial technologies has
presented regulators with a challenging landscape. With fraudsters leveraging
advanced digital tools, the SEC’s new unit aims to stay ahead by utilizing its
staff’s substantial fintech and cybersecurity expertise.

By prioritizing enforcement in these critical areas, the
agency seeks to maintain investor trust and strengthen market integrity. With
CETU’s launch, the SEC signals a renewed focus on digital fraud enforcement,
ensuring that innovation in finance does not come at the expense of investor
protection.