Risk & Compliance

SEC Keeps up High Rate of Enforcement Activity

Excluding actions against delinquent filers, the SEC filed 299 cases in the first half of fiscal 2017 — virtually unchanged from the year-ago period.
Matthew HellerApril 21, 2017
SEC Keeps up High Rate of Enforcement Activity

U.S. Securities and Exchange Commission enforcement activity continued at a strong pace during the first half of fiscal 2017 despite the uncertainty hanging over the agency since President Donald Trump took office.

Between Oct. 1 and March 31, the SEC filed 334 total enforcement actions, compared to 372 during the same period in fiscal 2016, according to a new report from Cornerstone Research. But excluding actions against delinquent filers, there were 299 enforcement actions — virtually unchanged from the year-ago period.

Of those cases, 231 were for new matters and 68 were administrative proceedings related to previously filed cases. In 2016, the equivalent numbers were 225 and 77.

Actions against delinquent filers dropped by 50%, from 70 to 35.

“In the face of uncertainty brought on by changes in SEC leadership and the new administration, enforcement activity continued last year’s heightened pace,” Dr. David Marcus, senior vice president at Cornerstone, said in a news release.

He also noted that despite court challenges to the administrative proceeding forum, the commission continued to file the vast majority of its actions (80%) as administrative proceedings rather than civil actions.

The report also analyzed actions by enforcement types, finding that actions against broker-dealers increased 20% in the first half of fiscal 2017 and accounted for 25% of total activity. Other categories that showed increases were actions related to issuer reporting and disclosure (up 34%) and those related to securities offerings (also up 34%).

Insider trading actions dropped to 14 from 21 in the year-ago period and Foreign Corrupt Practices Act cases fell to seven from 10.