A new report based on data from the Securities Enforcement Empirical Database (SEED) offers some interesting angles on the SEC's enforcement actions against public companies since FY 2010. Among other things, the report shows that since FY 2010, SEC enforcement has undergone a "dramatic shift" in its choice of venue for bringing cases against public company defendants, with a significant move toward administrative proceedings.
As I discussed here in October 2015, , SEED was recently launched as a joint venture of the NYU Pollack Center for Law & Business and Cornerstone Research. SEED tracks SEC enforcement actions against public companies going back to the beginning of the SEC's FY 2010 (October 1, 2009), including defendants' names and types, violations, venues, and resolutions.
Today's report from SEED ("SEC Enforcement Activity Against Public Company Defendants, Fiscal Years 2010–2015") shows that in FY 2015, the SEC filed 76 percent of its enforcement actions against public company defendants as administrative proceedings. By contrast, in FY 2010 through FY 2013, the SEC brought more than 65 percent of its enforcement actions against public company defendants in federal court. The chart below from page 6 of the report illustrates the shift in venue in FY 2014 and FY 2015:
The report also indicates a shift in venue -- again from federal court to administrative proceedings -- for the SEC's largest cases with respect to penalties and disgorgements against public company defendants. The SEC's 10 largest such penalties/disgorgement matters since FY 2010 are listed below. While three of these 10 cases were brought in federal court in FY 2010, since that time 6 of the remaining 7 of these large penalty cases have been brought as administrative proceedings, including the last five in a row:
Read the full report here.