The US Securities and Exchange Commission filed 760 enforcement actions in 2022, a 9 percent increase over the prior year. Enforcement actions totaled $6.439 billion which is the highest in SEC history, up from $3.852 in 2021.
This week, the SEC announced its FY22 Enforcement Results. A key focus of the 2022 SEC enforcement actions and penalties was to deter future violations, establish accountability from major institutions, and set examples for other financial firms.
This is exemplified by the SEC’s actions against 16 major financial institutions for widespread failures to maintain and preserve work-related communications. Each of these firms have agreed to start projects to remediate past failures and prevent future misconduct.
“As reflected in these results, the Enforcement Division is working with a sense of urgency to protect investors, hold wrongdoers accountable and deter future misconduct in our financial markets,” said Gurbir S. Grewal, Director of the Division of Enforcement.
Whilst the money ordered in SEC actions is the highest on record - the SEC does not expect this to grow year on year. Instead, it has highlighted that the commission expects behaviors to change and firms to improve their compliance going forward.
"While we set a Commission record this past fiscal year for total money ordered at $6.4 billion, including a record $4.2 billion in penalties, we don’t expect to break these records and set new ones each year because we expect behaviors to change. We expect compliance," added Mr. Grewal.
The announcement highlights the SEC's use of sophisticated technologies, tools, and data analytics to assist with investigations and hold those who violate securities laws accountable. It also points to the importance of its whistleblower program and the tips, complaints, and referrals it receives from the public, self-regulatory organizations, and others of possible securities law violations.
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