SEC Settlements Trends: 1Q09 Update

Thu Apr 09 16:24:38 EDT 2009

Under heightened scrutiny, but with its staff empowered by reforms mandated by Chair Mary Schapiro, the SEC reached 182 new settlements in the first quarter of 2009, according to NERA's new SEC Settlement Trends report. This exceeds both the 123 settlements in the previous quarter and the 157 settlements in the first quarter of 2008.

The report's authors note that Ms. Schapiro has announced several new policy initiatives since her appointment by the Obama Administration that will impact SEC settlements. These include ending the SEC's "penalty pilot" program, initiated by former Chair Christopher Cox; increasing the staff's subpoena power; and monetarily compensating whistle blowers. It remains to be seen what effects these policy shifts will have on SEC settlements, and how long it will take for these effects to be felt. NERA will continue monitoring these trends in our quarterly reports.