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2016 SEC Enforcement Results

Oct 31, 2016 2:29:11 PM ,


On October 11th, 2016, the Securities and Exchange Commission announced that, in fiscal year 2016, it filed 868 enforcement actions exposing financial reporting-related misconduct by companies and their executives and misconduct by registrants and gatekeepers, as the agency continued to enhance its use of data to detect illegal conduct and expedite investigations.

The new single year high for SEC enforcement actions for the fiscal year that ended September 30 included the most ever cases involving investment advisers or investment companies (160) and the most ever independent or standalone cases involving investment advisers or investment companies (98).  The agency also reached new highs for Foreign Corrupt Practices Act-related enforcement actions (21) and money distributed to whistleblowers ($57 million) in a single year.

The agency also brought a record 548 standalone or independent enforcement actions and obtained judgments and orders totaling more than $4 billion in disgorgement and penalties.

“By every measure the enforcement program continues to be a resounding success holding executives, companies and market participants accountable for their illegal actions,” said SEC Chair Mary Jo White.  “Over the last three years, we have changed the way we do business on the enforcement front by using new data analytics to uncover fraud, enhancing our ability to litigate tough cases, and expanding the playbook bringing novel and significant actions to better protect investors and our markets.”

The SEC’s most significant enforcement actions in fiscal year 2016 include:

  1. Insider trading and beneficial ownership reporting-related charges against Leon G. Cooperman and his firm Omega Advisors.
  2. Insider trading charges against William “Billy” Walters and his source Thomas C. Davis, a former Dean Foods Company board member.
  3. A $415 million enforcement action against Merrill Lynch for violating customer protection rules by misusing customer cash and putting customer securities at risk.  The firm also admitted wrongdoing.
  4. A $267 million enforcement action against J.P. Morgan wealth management subsidiaries, for failing to disclose conflicts of interest to clients.  The firms also admitted wrongdoing.
  5. FCPA cases against the Och-Ziff hedge fund and its CEO and CFO and against VimpelCom Ltd. in which the companies paid hundreds of millions of dollars to settle the charges.


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Tags: Insurance, insurance, Iron Cove Posts, Directors & Officers Liability, D&O, dodd-frank, hedge fund, Hedge Fund Regulation, Iron Cove Partners, Lou D'Agostino, Regulation, regulation, Risk, Risk Management, SEC, SEC Investigations

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