SEC Settlements Trends: 3Q09 Update

Mon Dec 07 15:24:38 EST 2009

The number of Securities and Exchange Commission (SEC) settlements declined for the second consecutive fiscal year in 2009, with 626 defendants, compared to 673 in fiscal year 2008, according to NERA's fiscal year-end SEC Settlements Trends report. The report's authors note that the 2009 fiscal year-end figures represent the lowest annual number of settling defendants since the Sarbanes-Oxley Act was implemented in 2002.

Fiscal year 2009 brought substantial changes to the SEC, in both leadership and its enforcement process. Mary Schapiro replaced Christopher Cox as Chairman of the agency, and Robert Khuzami took over as the Director of Enforcement. Under new leadership, the authors note, the SEC has enacted several reforms to its enforcement process that could strengthen enforcement activity in coming months. Because of the time that it takes for an investigation to become an enforcement action and settlement, the full impact of the reforms already implemented is likely yet to be seen.