The rate of SEC actions against public companies outpaced other enforcement activity in the last four fiscal years, according to a report issued Tuesday by the NYU Pollack Center for Law & Business and Cornerstone Research based on data from the Securities Enforcement Empirical Database.
There was a 130% increase from fiscal year 2013 to 2016 in SEC actions against public company defendants compared to a 61% increase in independent or stand-alone enforcement actions, the report said. SEED started tracking actions in 2010. The most common allegation in fiscal 2016 was issuer reporting and disclosure, which made up 26% of public company-related actions.
Public company-related actions increased to 92 cases in fiscal 2016 from 84 cases the previous year. Between fiscal year 2010 and fiscal year 2016, the top 10 monetary settlements imposed in public company-related actions totaled more than $3.4 billion. Eight of the top 10 settlements involved financial institutions, the SEED data show.
There was also a higher degree of cooperation from defendants, the researchers found, and 97% of such actions were settled at the time the Securities and Exchange Commission filed an action. “The SEC noted cooperation more frequently in administrative proceedings than civil actions, a disparity that has increased noticeably over the last three fiscal years,” said Stephen Choi, Pollack Center director, in a statement.
The report is available on Cornerstone's website.
