The SEC announced today that it brought 671 enforcement actions in its fiscal year 2008 (ended Sept. 30, 2008), the second-highest number of enforcement actions in agency history. It also announced that for the second year in a row, it returned more than $1 billion to harmed investors through Fair Fund distributions.

Some of the enforcement highlights from 2008 emphasized by the SEC:

• the “highest number ever” of insider trading cases, including charging former Dow Jones Board Member David Li and three other Hong Kong residents in a $24 million insider trading enforcement action, and charging the former chairman and CEO of a division of Enron Corp. with illegally selling hundreds of thousands of shares of Enron stock based on nonpublic information.
• a record number of enforcement actions against market manipulation in 2008, including charges against a Wall Street short seller for spreading false rumors, and charges against 10 insiders or promoters of publicly traded companies who made stock sales in exchange for illegal kickbacks.
• fraud cases against two Bear Stearns hedge fund managers for fraudulently misleading investors about the financial state of the firm’s two largest hedge funds.
• charges against five former employees of the City of San Diego for failing to disclose to the investing public buying the city’s municipal bonds that there were funding problems with its pension and retiree health care obligations and those liabilities had placed the city in serious financial jeopardy.
• charges against eight public companies and 27 executives of providing false information to investors based on improper accounting for backdated stock option grants.
• 15 Foreign Corrupt Practices Act cases. The SEC added that since January 2006, it has brought 38 FCPA enforcement actions - more than were brought in all prior years combined since FCPA became law in 1977.

Of course, as we’ve written about here previously, there is a certain amount of gamesmanship - both in terms of timing and the actual cases that are counted - to the SEC’s annual tally of enforcement actions. Indeed, there is not even total clarity on whether a high number of enforcement actions is a good thing (i.e., “SEC working very hard”) or a bad thing (i.e., “SEC’s actions not deterring securities violators”). But Congress requires the SEC to compile and report this tally each year, which is what prompted today’s SEC press release. The SEC stated that additional data on its 2008 enforcement results will be available as part of the agency’s Performance and Accountability Report, which is scheduled to be published in mid-November.

Read the SEC’s press release