Welcome back to the Compliance in Context Podcast! On today’s show, we feature a Lessons From The Front Lines episode where we will be providing a comprehensive, deep-dive look at the 2024 SEC Enforcement numbers published at the end of last year—including what was behind some of the eye-popping numbers, distinct areas of focus, and what firms can expect next under a Paul Atkins-led SEC. To help guide us through this important topic and share some fantastic insights for our listeners, we welcome a fantastic panel of experts, Brian Rubin from Eversheds Sutherland and Jim Lundy from Foley and Lardner.

Show

Interview with Brian Rubin and Jim Lundy

• What were the 2024 SEC Enforcement numbers and what do they tell us?

• What trends were present in areas like off-channel business communications and marketing and advertising?

• Did firms get any credit for cooperating with the SEC and how did that manifest?

• What can we expect from Enforcement under a Paul Atkins-led SEC?

• What do you expect from Enforcement pre- and past-Wells letter and with regard to other parts of the process including virtual meetings and open jacket discovery?

• Where do you see Enforcement making substantive changes to its approach under Atkins?

• Can we glean anything from Atkins’ prior dissents that can give us insight into his own priorities as the new Chair?

• What does the future leadership of the SEC look like and what’s next for the Division of Enforcement?

Quotes

11:22 - “Speaking of past data not being indicative of future results. In fiscal year ‘24, the commission brought cases against more than 70 firms, resulting in $600 million more in additional penalties, for those of us who’ve been living through this for the past several years. There’s no surprise that prior to January 2025, that leads to some pretty big numbers. And in the release, enforcement touted that since December of 2021, the initiatives in this space have resulted in changes against more than 100 firms and civil penalties in excess of $2 billion. As Brian mentioned, enforcement continued to be busy after the election through its first fiscal quarter for this fiscal year. And recently announced on January 13th, 12 more actions brought against nine investment advisors and three broker-dealers for off-platform books and records, record-keeping violations, and an additional $63.1 million in total penalties brought against those 12 firms” - Jim

23:17 - “We have a list of a few things that may happen. So, one of them is that there’s probably going to be a push to reduce the time that it takes to investigate cases. Everybody on the defense side and on the enforcement side thinks it takes too long and there’s a variety of reasons that it does take a while. One idea is a simple idea to just simply shorten the time period that investigations have. And although President Trump said he did not read Project 2025, which was a huge sort of white paper on things the new administration could do, one of the recommendations it contained called for statutorily limiting the time for investigations to two years.” - Brian

32:25 - “My personal view, I’m sure Brian wou...