Nevertheless, it appears that the SEC is once again paying increased attention to financial reporting cases. In 2015, the SEC brought enforcement cases against 191 parties (in contrast to 128 parties in 2014), a significant increase over prior years. Simply scanning the list of settled enforcement cases supports SEC Chair White’s recent statement that the SEC “has reinvigorated its investigative and enforcement efforts” in this area, and is closely scrutinizing “the gatekeepers of financial reporting, continuing to hold accountants, auditors, and audit committees accountable under appropriate circumstances.”
Below, we will discuss the potential reasons for a renewed focus on financial reporting and financial fraud. We also will review recently reported settled SEC actions relating to financial fraud. Issuers need to be careful not to take shortcuts around recognized accounting rules or their accounting advisors.
‘Enforcement 40’ for 2020
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