November 27, 2017: The U.S. Securities and Exchange Commission (“SEC”) was established by an Act of Congress to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. Compliance with the Investment Advisers Act, the Investment Company Act, and other federal securities statutes is highly dependent upon the adviser’s capacity to fully appreciate where the SEC is headed when they contemplate a deficiency letter, enforcement action, or referral to the Department of Justice. For investment advisers, all aspects of the SEC mission statement have a direct correlation to the adviser’s business model, i.e., the non-compliant registered investment adviser presents an ongoing threat to undermine the Commission’s execution of its mission statement and therefore attracts significant resources and scrutiny from the regulator.
Fiscal year 2017 was by all accounts a successful year for the SEC’s Division of Enforcement. The Commission brought 754 actions and obtained judgments and orders totaling more than $3.7 billion in disgorgement and penalties. Significantly, it also returned a record $1.07 billion to harmed investors, suspended trading in the securities of 309 companies, and barred or suspended more than 625 individuals. Read More