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Join the Securities Litigation and Enforcement Group on LinkedInJudges keep knocking SEC gag rule but defendants can’t find a way to evade it | Reuters
The Moraes and Novinger cases – along with another recently fizzled challenge to the SEC policy – show why it’s so hard, as a matter of procedure, for judges to impose change on the SEC, even when courts believe the government should not condone a policy that effectively forces defendants to waive their constitutional rights. […]
US Federal Judge in New York Criticizes SEC ‘Gag Orders’ Policy – Reuters
A US federal judge in New York on Friday called it “troubling” that a Securities and Exchange Commission (SEC) policy makes people who settle charges of fraud, insider trading or other agree not to deny them later. Under the decades-old policy, defendants who settle without admitting to must agree not to publicly deny them. The […]
SEC faces lawsuit over ‘gag orders’ in enforcement settlements | Article | Compliance Week
“The sole purpose of the gag regulation is to affect public perception of the SEC and the SEC’s enforcement activities,” the Cato lawsuit says. “It accomplishes its purpose by restricting constitutionally protected speech—specifically, speech critical of the SEC itself … The SEC demands blanket, perpetual gag orders of this sort in every case it settles […]
SEC faces lawsuit over ‘gag orders’ in enforcement settlements | Compliance Week
The Cato Institute, a libertarian think tank, is suing the Securities and Exchange Commission in federal court to challenge its decades-old policy of imposing “gag orders” on settling defendants in civil enforcement actions. *** “The sole purpose of the gag regulation is to affect public perception of the SEC and the SEC’s enforcement activities,” the Cato […]
Admissions in SEC Enforcement Cases: The Revolution That Wasn’t
…The SEC continues to report record enforcement numbers and has touted the admissions policy as a great success. However, this Article empirically demonstrates that the SEC has obtained admissions in a very small number of cases since adopting the new policy, and on only a few occasions in cases involving the most serious charges, namely […]
Sand Hill Exchange Founder Accepts Responsibility, Has Feedback for SEC | Compliance Week
In an unusual video “Response to SEC Enforcement Action,” the founder of the Sand Hill Exchange personally accepted responsibility for all wrongdoing by the exchange and offered some constructive criticism and feedback to the SEC. via Sand Hill Exchange Founder Accepts Responsibility, Has Feedback for SEC | Compliance Week
Challenging Consequences: The Government’s Requirement for Wrongdoing Admissions in Civil Fraud Suits | The D&O Diary
In one of the more troublesome recent developments for corporate officials who find themselves targeted by government investigations, both the U.S. Department of Justice and the Southern District of New York U.S. Attorney’s Office have made it clear that as part of the settlement of civil fraud actions, the governmental authorities intend to seek both […]
Rengan Rajaratnam Settlement Exposes Slightly Weak Point in SEC’s Newish Admissions Policy | Cady Bar the Door
Anyway, I thought that until I read this quote from Rajaratnam’s lawyer, Daniel Gitner: “The S.E.C. elected to offer, and Rengan elected to accept, a no admit/no deny settlement. Rengan is moving on to the next phase of his life. If the S.E.C. has further comment, so will we.” Gitner was right to make this […]
Second Circuit Vacates Judge Rakoff’s Rejection of SEC’s Citigroup Settlement | The D&O Diary
On June 4, 2014, in a long-awaited but not unexpected opinion (here), the Second Circuit ruled that Southern District of New York Judge Jed Rakoff had improperly rejected the $285 million settlement of the SEC’s enforcement action against Citigroup. Because the case involved the question of whether or not parties may enter into “neither admit […]
Financial regulators don’t agree on Wall Street mea culpas — Reuters
Wall Street’s self-funded regulator has not been swayed by the U.S. Securities and Exchange Commission’s new policy that some industry wrongdoers should admit to their bad behavior. That may be good for brokers and firms who are targets of the Financial Industry Regulatory Authority’s enforcement actions, but it does not please some investor advocates. via […]