Almost everyone has an opinion about securities enforcement. Many are disappointed (and even angry) that “few high level executives” have been prosecuted (criminally or even civilly) in connection with the 2008 financial crisis. Deep in their bunker, the SEC still has some diehards who maintain that fraud has been fully prosecuted, but, even there, attitudes are changing. The shift is much clearer at the Department of Justice (“DOJ”), which has just settled with JPMorgan for $13 billion and may be in hot pursuit of still unnamed defendants. Even if the SEC is presenting itself as a more aggressive enforcer under its new Chair, questions remain about whether its behavior has truly changed.
Although there is a surplus today of opinions about how enforcement should change, there is a paucity of facts. Why is it that enforcers have underperformed? What practical steps are possible? Provocative new proposals are being made, but they too need to be informed by better factual evidence as to how regulators actually behave….
‘Enforcement 40’ for 2020
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