Regulatory Enforcement Defense

Lionel André attorney profile image

Washington, DC

T: (202) 661-7039
F: (202) 661-7059

New York, NY

T: (212) 880-3583
F: (212) 880-3998
Christian R. Bartholomew attorney profile image

Washington, DC

C: (202) 853-4944
T: (202) 220-1940
F: (202) 661-7059
Daniel T. Brown attorney profile image

Washington, DC

T: (202) 661-7020
F: (202) 661-7059
Katherine Cooper attorney profile image

New York, NY

T: (212) 880-3630
F: (212) 825-9828
James Dombach attorney profile image

Washington, DC

C: (202) 834-2080
T: (202) 661-7019
F: (202) 661-7059
Stephen T. Gannon attorney profile image

Washington, DC

T: (202) 220-1924
F: (202) 661-7059

Richmond, VA

T: (804) 762-5339
Barry S. Gold attorney profile image

New York, NY

C: (347) 949-2054
T: (212) 880-3978
F: (212) 880-3998
Joseph I. Goldstein attorney profile image

Washington, DC

C: (202) 480-6811
T: (202) 661-7013
F: (202) 661-7059
Christina M. Hill attorney profile image

Washington, DC

C: (202) 480-5278
T: (202) 661-7017
F: (202) 661-7059
Robert P. Howard, Jr. attorney profile image

Washington, DC

C: (202) 480-7326
T: (202) 661-7015
F: (202) 661-7059
Harris L. Kay attorney profile image

Chicago, IL

C: (312) 813-6855
T: (312) 820-5130
Theodore A. Krebsbach attorney profile image

New York, NY

C: (347) 758-2295
T: (212) 880-3975
F: (212) 880-3998
Joseph C. Lombard attorney profile image

Washington, DC

C: (312) 543-7750
T: (202) 661-7028
F: (202) 661-7059
Alexandra J. Marinzel attorney profile image

Washington, DC

C: (202) 680-4902
T: (202) 661-7033
F: (202) 661-7059
Michael P. McDonald attorney profile image

Washington, DC

C: (202) 934-4130
T: (202) 220-1950
F: (202) 661-7059
Thomas J. McGonigle attorney profile image

Washington, DC

C: (202) 680-4941
T: (202) 661-7010
F: (202) 661-7059

New York, NY

T: (212) 880-3624
Andrew J. Melnick attorney profile image

New York, NY

C: (203) 984-8256
T: (212) 880-3580
F: (212) 880-3998
Sharon A. O'Shaughnessy attorney profile image

New York, NY

C: (917) 538-9223
T: (212) 880-3990
F: (212) 880-3998
Robertson Park attorney profile image

Washington, DC

C: (202) 680-4181
T: (202) 661-7022
F: (202) 661-7059
Michael V. Rella attorney profile image

New York, NY

C: (914) 525-1916
T: (212) 880-3973
F: (212) 880-3998
For more information visit Our Team page.

Looking Forward

We see aggressive enforcement ahead. In recent remarks, new SEC Chair Gary Gensler invoked New Deal-era predecessors and promised “hard,” “novel,” and “high-impact” cases, while specifically rejecting criticism that this is “regulation by enforcement.” Despite decades of SEC no-admit settlements, he announced that his SEC “may seek admissions in certain cases where heightened accountability and acceptance of responsibility are in the public interest.” He reported instructing staff to move matters quickly and “cut back on meetings” with defense counsel, and cautioned SEC targets against “going right up to the edge of a rule or searching for some ambiguity in the text.”

More generally, Gensler has expressed strong interest in a variety of substantive areas, including payment for order flow, ESG disclosure, and crypto trading. These appear poised to become hot enforcement zones. Gensler has also credited the SEC staff whistleblower program, which has paid over $1 billion to tipsters over recent years, for its role in helping source cases. With Gensler’s new leadership team now settling in, we will likely see his new initiatives and approaches executed quickly.

The SEC’s FY 2021 numbers reflect steady production despite staff working from home and taking testimony by videoconference, with new enforcement cases rising to 434 from 405 the year before, delinquent filing matters fairly steady at 120 down from 130, and “follow-on” suspensions dipping to 143 from 180. However court rulings and legislative developments created uncertainty over SEC remedies, with disgorgement dropping to $2.4 billion from $3.6 billion in FY 2020, while penalties rose to $1.4 billion from $1.1 billion. Case mix tilted heavily toward securities offerings (33%), investment advisers and investment companies (28%), and issuer reporting and audit-accounting (12%), compared with single-digit showings by broker-dealer (8%), insider trading (6%), and market manipulation (6%).