Adjustments to the SEC’s enforcement function is enabling it to be more aggressive with individuals and corporations when pursuing allegedly violative behavior.

The SEC’s ongoing push to strengthen penalties for wrongdoing attempts to further deter current and future bad actors, stiff monetary penalties and sanctions not only punish alleged violations but send clear signals of the SEC’s intolerance of wrongdoing.  Thus, the focus with the SEC should be on:

  • if circumstances surrounding the case justify expending SEC resources and if the agency should be targeting the alleged violations in the first place;
  • if the SEC’s settlement position is too aggressive, given the context of the assertions of wrongdoing;
  • if the SEC’s legal theory makes sense; and
  • if bringing the case might make bad law.

In sum, there is a very tight rope one walks when dealing with the SEC on these issues.