The chair of the Securities and Exchange Commission discussed his approach to investigating financial misconduct and protecting investors, according to Advisor Hub. Gary Gensler’s remarks came last week during an appearance at the Securities Enforcement Forum.
Calling enforcement one of the fundamental pillars in achieving the SEC’s mission, Gensler outlined the principles he has asked the commission’s Enforcement Division to consider.
One principle, he said, would involve making sure the economic realities of a given product or arrangement comply with securities laws.
“History tells us that when a group of people try to mask the underlying economic realities of a certain product or instrument, investors can get hurt,” said Gensler. “Further, their pain can spread from the financial system to the real economy.”
He added that another important part of the SEC’s enforcement agenda is accountability. Gensler pledged to use all tools at the commission’s disposal “to investigate wrongdoing and hold bad actors accountable.” He said such accountability instills confidence in financial markets and the overall economic system.
Another principle detailed by Gensler involved what he called high-impact cases. He said the SEC would pursue misconduct wherever it is found to protect the public from financial scams that harm investors. “That will include the hard cases, the novel cases, and, yes, the high-impact cases — whether in special purpose acquisition companies; cyber; crypto; or private funds; whether accounting fraud, insider trading, or recordkeeping violations,” he said. Gensler added that tough enforcement action in these cases sends a message to the rest of the market that certain misconduct will not be tolerated.
He said the SEC would focus on bringing cases expeditiously and bringing them to resolution swiftly, noting the old legal saying that “justice delayed is justice denied.”
The FINRA investigation defense attorneys of Hyman Cotter PC were formerly senior attorneys in the SEC’s Division of Enforcement and understand the complexities that come with being the subject of a regulatory inquiry by the SEC, state regulators and other self-regulatory organizations such as FINRA and various exchanges. If you are the subject of a regulatory proceeding, contact us at 312-291-4600 or through our online contact form for a free consultation.
