A Securities and Exchange Commission pilot program intended to strengthen the hand of its enforcement staff and speed the resolution of cases involving fines against corporations is raising concerns among defense lawyers about their ability to negotiate settlements.
As Compliance Week previously reported in April, the SEC said in some cases where a fine may be levied against a company, the SEC’s five commissioners will give the enforcement staff guidance—including advice on acceptable fines—before SEC lawyers begin settlement discussions with an issuer. That departs from decades of previous policy, where SEC lawyers negotiated with companies first and then brought settlement proposals to the commissioners for approval. Under that regime, commissioners heard little about the details of a case until a potential settlement was brought for approval.
