By David Wignall
June 27, 2025
The SEC’s Office of the Investor Advocate released a report Wednesday detailing its plans for the next fiscal year. In addition to other goals, the SEC advocate’s office will spend the next 12 months assessing the benefits and pitfalls of allowing private investments in retirement accounts—a hot topic on Capitol Hill.
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The Office of the Investor Advocate is an independent office established by Congress to research and promote the interests of retail investors within the SEC. The Investor Advocate can, and frequently does, recommend changes to SEC regulations. Its current leader, Cristina Begoña Martin Firvida, was appointed by SEC Chairman Gary Gensler, a Democrat, in 2023.
This year’s report from Firvida’s office raises concerns over the potential impact on individual investors if private investments are included in retirement plans. Private equity and private credit, the report notes, offer diversification and the potential for strong returns. However, it says that private investments have certain shortcomings, including “reduced, incomplete, and unreliable disclosures, limited liquidity, and greater risk of fraud.”
The report further notes that these pitfalls raise complex regulatory issues because retirement plans are held to stricter fiduciary standards.
The stakes are high. Americans currently hold more than $12 trillion in retirement accounts—but plan providers have long been reluctant to include private investments in their offerings, citing regulatory concerns. If retirement regulations change, the floodgates may open.
In March, BlackRock CEO Larry Fink called for greater retirement access to private markets. Firms like Blackstone, Apollo Global Management, and KKR have all partnered with retirement funds to launch hybrid public-private products in the last year. On Thursday, BlackRock announced that it had partnered with Great Gray, a trust company, to provide target-date retirement funds which include private investments.
On Tuesday the House voted to expand the definition of accredited investors to include people with relevant education or professional experience. If passed, it would be one step toward making private investments accessible to a broader group of investors.
Other SEC priorities. In addition to its work on retirement accounts, the investor advocate’s report outlines other priority areas, including improving how easy it is for investors to read and understand mandated reports (like company 10-Ks, which are getting longer and more complex).
The office is also reviewing risks associated with China-based “variable interest entities” (a popular yet amorphous investment structure which can allow foreign investors to avoid a nations’ restrictions on foreign ownership), and supporting the efforts of the SEC’s Crypto Task Force.
Fraud rates climb. The report sounds an alarm bell over the steep increase in investment scams. “Our data shows a 142% increase in reports primarily involving allegations of security fraud violations,” the office notes.
While the report says that part of the surge may reflect the investor advocate’s improved outreach efforts, it also mirrors a broader trend. In 2024, the U.S. Federal Trade Commission found that consumers lost more than $5.7 billion to investment scams—a 24% increase compared with a year earlier.
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