SEC Settlements Trends: 1H10 Update
14 May 2010
By Dr. James Overdahl et al.
The latest report from NERA's ongoing analysis of trends in Securities and Exchange Commission (SEC) enforcement action settlements finds that the SEC settled with 354 defendants in the first half of fiscal year 2010 (October 2009 through March 2010), compared to 328 defendants in the second half of FY 2009 and 290 in the first half of 2009. According to the report, SEC Settlements Trends: 1H10 Update, the SEC's settlement activity in the first half of 2010 marks the second consecutive semiannual increase and third-largest number of settlements in any six-month period since 2005. While the number of settling defendants has been on an upward trend over the past year, overall settlement values have remained relatively steady compared to historical levels.
The report also notes that the SEC settled two subprime-related cases for over $100 million in the first half of the 2010 fiscal year. State Street Bank and Trust Company’s $314 million settlement with the SEC ranks as the largest in the first half of 2010, and the seventh-largest settlement overall since the passage of the Sarbanes-Oxley Act. What remains to be seen is whether these cases, along with the recent action against Goldman Sachs, are the beginning of a new wave of subprime-related SEC settlements.
The report's findings are informed by NERA's proprietary database of settlements in SEC enforcement actions, which is based on litigation releases and administrative proceeding documents published from 31 July 2002 through 31 March 2010. SEC Settlements Trends: 1H10 Update, historical SEC settlement data, and previous SEC settlement trends reports can be viewed on NERA's Securities Litigation Trends website.
