The SEC has taken recent enforcement action against Deerfield Capital Management (Deerfield), Artis Capital Management (Artis) and R.T. Jones Capital Equities Management (R.T. Jones) for failing to maintain policies and procedures tailored to the risks of their respective operations. Although the areas of deficiency in question vary widely, the respondents all found themselves in trouble for allegedly failing to maintain and enforce “reasonably designed” policies and procedures. Despite expectations that the SEC, under new leadership, would reduce the “broken windows” approach to enforcement, some believe these three cases foreshadow the deployment of the dramatically expanded resources available to the SEC’s Office of Compliance Inspections and Examinations for investment adviser examinations in a broad effort to ensure that firms maintain appropriately tailored policies and procedures, as well as oversee employees in sensitive areas of their operations. As SEC Chair Jay Clayton recently told the Hedge Fund Law Report, “looking at firms’ policies and procedures will continue to be a priority for the Commission.” To help readers understand this trend, adopt best practices and insulate themselves against similar enforcement actions, the HFLR has interviewed legal professionals with expertise in regulatory enforcement matters. This article presents the insights from those interviews, along with Clayton’s further thoughts on the matter. For analysis of the Deerfield, Artis and R.T. Jones cases, respectively, see “Hedge Fund Manager Deerfield Fined $4.7 Million for Failing to Adopt Insider Trading Compliance Policies Tailored to the Firm’s Specific Risks” (Sep. 21, 2017); “General Insider Trading Policies and Procedures May Be Insufficient for Hedge Fund Managers to Avert SEC Enforcement Action” (Nov. 3, 2016); and “Investment Adviser Penalized for Weak Cyber Policies; OCIE Issues Investor Alert” (Oct. 1, 2015).