Enforcements continue despite lack of regulatory updates

As is typical over the holiday period, the past few months have been quiet from the SEC on the regulation side of the house. And with the upcoming election it’s hard to predict how much or little regulation will gets passed over the next few months too. Despite this, enforcement action doesn’t appear to have slowed down at all.

Enforcement actions taken by the SEC at the end of last year can be used to identify new trends worth keeping an eye on in 2024:

In just the past couple of months, these cases continue to support the idea that the SEC is paying attention and not afraid to issue penalties it feels are necessary, even if new regulation is not coming out.

Recent notable actions taken by the regulator include the following:

Despite merely scratching the surface, these examples all share the common theme of fraud and misleading investors. Although it’s hard to pinpoint exactly why this is so prevalent right now, our experience suggests that companies are feeling the pressure of what has been a generally slow economy and investment markets over the past few years. This typically leads to businesses not meeting financial objectives, which in turn leads to individuals engaging in unscrupulous practices to make sure they hit their numbers.

Compliance professionals should therefore have their ears perked up and be carefully monitoring for red flags. It’s times like these where having a strong culture of compliance becomes so important. As this isn’t something that can be instated overnight, you must continuously work to ensure your firm’s practices and processes can detect and protect you from any of these difficult circumstances.

How we can help

If you would like to talk more about how you can strengthen the culture of compliance at your organization, please do not hesitate to reach out.