SEC Filed More New Cases in 2021, but Enforcement Activity Less than Previous 5 Years
The SEC Enforcement Division filed more new enforcement cases last year than 2020 but collected less money than the last 5 years.
Reporting on its litigation activities for the fiscal year ending 9/30/21, the Enforcement Division filed 434 new standalone cases in 2021, compared to 405 in 2020. However, standalone cases were fewer than the prior four years, and total cases were significantly lower than the prior five years. The SEC won $3.8 Billion in penalties and disgorgement, significantly less than the $4.68 Billion in 2020 and less than each of the prior 4 years as well. Cases against investment advisers and investment companies accounted for 28% of the total, the second largest category after securities offerings.
We don’t think these more modest numbers reflect a more industry-friendly Enforcement Division, or that the Enforcement Division reached its nadir during the Mary Jo White era. Instead, we believe these numbers represent the calm before the storm given the warnings of new SEC Chairman Gary Gensler and SEC Enforcement Director Gurbir Grewal, each of whom has been in office only a portion of the fiscal year reflected in the numbers.
See SEC Report here.