- The Securities and Exchange Commission is pursuing fewer penalties on corporations under President Donald Trump.
- The SEC filed 612 enforcement cases in its most recent fiscal year, the fewest in four years, according to a Georgetown University study cited by Bloomberg.
- SEC Chair Jay Clayton has said penalties against corporations hurt shareholders and not just the individuals who may have been responsible for alleged wrongdoing.
Wall Street’s top regulator is pursuing fewer punishments under President Donald Trump.
In the most recent fiscal year, the Securities and Exchange Commission imposed the fewest penalties in four years, according to a study by Urska Velikonja, a Georgetown University law professor. Bloomberg reported that her study found the SEC attempted to obtain $US3.4 billion in fines and other payments in the 12 months ended September. It filed 612 enforcement cases, the lowest since 2013.
This suggests that the regulatory environment is loosening under Trump, who had promised a climate more friendly to business interests while he was campaigning. One caveat, however, is that the fiscal year in Velikonja’s study included four months with former SEC Chair Mary Jo White, who served under the Obama administration.
Velikonja’s full findings are set to be published in the Notre Dame Law Review next year.
She found that SEC Chairman Jay Clayton, Trump’s appointee who was a lawyer for multiple banks during the financial crisis, has only pursued two sanctions against big financial firms since he took the helm in May. They were against State Street and Barclays, in settlements totaling $US132 million.
The study backs up a recent Politico report that also concluded the SEC has eased up on punishing corporations. According to the late-October story, the SEC collected $US127 million in civil case penalties against companies, down from $US702 million during the same period last year.
According to Politico, Clayton and the SEC have paid attention to company actions that affect retail or smaller investors rather than focusing on larger corporate cases. Clayton has said enforcement actions on large corporations hurt shareholders, not just the individuals who are responsible.
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