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SEC 2013 Enforcement Summary

On December 17, the SEC announced that its 2013 enforcement program resulted in a record $3.4 billion in sanctions, representing a 10 percent increase from 2012.  The financial penalties were a result of 686 enforcement actions for the SEC’s fiscal year ended September 2013.

SEC Chair Mary Jo White praised the enforcement program, stating, “I am incredibly proud of the dedicated and talented women and men of the Enforcement Division.  Our results show that we are prepared to tackle the breadth and complexity of today’s securities markets.”

The press release summarizes the SEC’s cases by area, including:

  • Market structure and exchanges;
  • Gatekeepers, which includes the SEC’s charges against trustees and directors “for failing to uphold their responsibilities under the securities laws;”
  • Insider trading;
  • Municipal securities; and
  • Financial crisis related actions.

The release also discusses the change to its settlement policy, which requires admission of misconduct “in a discrete category of cases where heightened accountability and acceptance of responsibility by a defendant are appropriate and in the public interest.”  The first two settlements under this new policy included Philip Falcone and his firm Harbinger Capital Partners and JP Morgan Chase.

The Division of Enforcement’s forward-looking initiatives include:

  • New task forces, including the Financial Reporting and Audit Task Force and Microcap Task Force;
  • Consolidated short selling charges;
  • A large number of cases in progress, with 908 open investigations including 574 formal orders of investigation; and
  • Technology improvements.