SEC files record number of enforcement cases and highest fines in 2015

Agency brings actions against new kinds of securities fraud

Oct 22, 2015 @ 1:22 pm

By Liz Skinner

The Securities and Exchange Commission homed in on several new types of errant financial behavior this year as it filed a record number of enforcement actions and fines against companies and individuals, the agency said Thursday.

The SEC filed 807 enforcement actions and obtained orders for $4.2 billion in penalties and disgorgements of ill-gotten gains for the year ended Sept. 30. That's a 7% increase from the previous year's record of 755 actions in fiscal year 2014. Fines and disgorgement increased 1% from $4.16 billion last year.

For the first time, the agency brought actions against a private equity adviser, Kohlberg Kravis Robert & Co., for allegedly improperly allocating $17 million in “broken deal” expenses, and charged Edward D. Jones & Co. for alleged pricing-related fraud in the primary market for municipal securities.

Led by Mary Jo White, who has been focused on enforcement, the commission also filed its first action against a fund board for failing to report a relevant compliance issue.

Ms. White said the enforcement division's use of data, analytics and other professional expertise within the agency helped it increase the number of cases filed.

“Vigorous and comprehensive enforcement protects investors and reassures them that our financial markets operate with integrity and transparency, and the commission continues that enforcement approach by bringing innovative cases holding executives and companies accountable for their wrongdoing,” she said.

Law professor Urska Velikonja, at Emory University in Atlanta, last month questioned the veracity of the commission's enforcement action statistics.

She said numbers that show a 50% increase in the number of enforcement cases the SEC brought in 2014 compared to 2000 are inflated because the figures include so many cases of companies filing late quarterly financial statements and others where actions against the same people are counted multiple times.

Andrew Ceresney, director of the SEC's enforcement division, said on a call with reporters Thursday that the commission always has been transparent in reporting its cases. However, the data the agency made public this year also spells out the number of follow-on cases “to add even more transparency,” he said.

The agency filed 507 independent enforcement actions, compared to 413 last year, and 168 follow-on actions, compared to 232 last year, according to commission data. It also brought 132 actions for delinquent filings in 2015, compared with 110 the previous year.


What do you think?

View comments

Recommended for you

Featured video


Why some retirement plan advisers think Fidelity is invading their turf

InvestmentNews editor Frederick P. Gabriel Jr. and reporter Greg Iacurci talk about this week's cover story that looks at whether Fidelity Investments is stepping on the toes of retirement plan advisers.

Latest news & opinion

Cetera reportedly exploring $1.5 billion sale

The company confirmed it's talking to investment bankers to 'explore how to best optimize [its] capital structure at lower costs.'

SEC Chairman Jay Clayton outlines goals for a new fiduciary standard

Rule should provide clarity on role of adviser, enhanced investor protection and regulatory coordination.

Advisers bemoan LPL's technology platform change

Those in a private LinkedIn chat room were sounding off about fears the independent broker-dealer will require a move to ClientWorks before it is fully ready.

Speculation mounts on whether others will follow UBS' latest move to prevent brokers from leaving

UBS brokers must sign a 12-month non-solicit agreement if they want their 2017 bonuses.

Maryland jumps into fiduciary fray with legislation requiring brokers to act in best interests of clients

Legislation requires brokers to act in the best interests of clients.


Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting It'll help us continue to serve you.

Yes, show me how to whitelist

Ad blocker detected. Please whitelist us or give premium a try.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print