Tue, Nov 17, 2020

Ken Joseph Discusses SEC Enforcement Report for Fiscal Year 2020

Ken Joseph, Managing Director and Global Head of the Disputes Consulting practice, discussed the SEC enforcement report for fiscal year 2020 with FundFire.

The number of SEC investment advisory enforcement actions dipped in 2020 as the agency adjusted to remote work. Overall, SEC enforcement actions were down 17% from the previous year. Of the 715 enforcement actions, 405 were “standalone” actions brought in federal court or as administrative proceedings. Of the 405 standalone actions, 87 were tied to investment advisors or investment companies, down from 191 during fiscal 2019, the report shows.

Despite the lower number of enforcement actions, the agency’s financial remedies soared to a record high. During fiscal 2020, the agency raked in $4.7 billion in disgorgement and penalties, a jump from $4.3 billion in 2019.

Ken indicated that the decline in the number of enforcement actions corresponds with the agency’s efforts in recent years to release more non-enforcement guidance and risk alerts. This approach has helped increase awareness of the SEC’s regulatory agenda and has led investment advisory firms to take steps to make sure they’re in compliance.

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