The U.S. Securities and Exchange Commission (SEC) intends to eliminate the positions of regional directors across its 10 offices nationwide as part of a cost-saving strategy being prepared for the Trump administration, according to two sources with knowledge of the matter.

On Friday, the agency informed these directors that their roles would be phased out under a proposal set to be submitted next month, the sources told Reuters.

This restructuring marks the latest shift at the SEC, the regulator overseeing the $100 trillion U.S. capital markets, since Republicans assumed leadership of the agency.

It aligns with a wider initiative led by Republican President Donald Trump and his special adviser, billionaire Elon Musk, to streamline the federal workforce.

The administration has already begun terminating thousands of federal employees, with Musk recently threatening further dismissals unless government workers justify their recent contributions.

The SEC is facing mounting pressure from the Trump administration to reduce staff and operational costs, with agency leaders directed to propose significant budget cuts.

Part of this effort involves the newly established Department of Government Efficiency (DOGE), championed by Musk, who is simultaneously entangled in SEC litigation over alleged securities violations.

While the bulk of the SEC’s workforce operates out of its Washington headquarters, its regional offices—spanning cities like San Francisco and Miami—play a critical role in overseeing examinations and investigations of public companies, brokers, and investment advisers.

Regional directors have traditionally spearheaded high-profile enforcement actions and lawsuits. Andrew M. Calamari, a former SEC New York office director and current partner at Finn Dixon & Herling LLP, described the regional leadership as a vital link in decision-making for enforcement and exams, calling their removal a challenging adjustment for the agency.

The decision to cut these director roles, which requires approval from the SEC’s three-member commission, is one piece of a broader cost-reduction strategy.

Details of other proposed changes remain unclear, as does the potential savings for taxpayers, given that the SEC operates as "deficit neutral," funded largely by industry fees rather than public dollars, per its latest congressional budget report.

In June 2024, the agency shuttered its Salt Lake City regional hub, though one source indicated there are no current plans to close additional offices.

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