Chairman Atkins’ SEC has consistently included financial and accounting fraud as one of its top enforcement priorities. The new SOX Group confirms this. Where the SEC has spent the last year focused on reducing the Enforcement Division’s staff, the new Group stands out as an area of Enforcement expansion.
More significantly, and although the SEC has not explicitly stated as much, the new Group may signal that the PCAOB’s Division of Enforcement and Investigations’ role as the primary cop for auditor misconduct is moving to the SEC. This conclusion is further supported by the recent reductions to the PCAOB budget and its likely impact on staffing, along with Hohl’s recent comments highlighting the confidentiality obligations imposed on the PCAOB — but not the SEC. It also appears consistent Chairman Atkins’ past PCAOB criticisms and his general statements disfavoring overlapping, parallel investigations from a fairness perspective.
Source: Reading Between the Lines: The New SEC SOX Enforcement Group | Foley & Lardner