Total cases initiated by the SEC have jumped to their highest level since 2016.
The number of cases the SEC filed against publicly traded companies hit at least a decade-high this year, according to findings from New York University and Cornerstone Research which analyzed the SEC’s annual report.
The jump is explained by an agency initiative that encouraged financial firms to self-report instances where advisers sold certain fee-paying mutual funds to clients over other funds. (In return for self-reporting, those companies would have to pay a small fee and don’t have to admit wrongdoing.)
This accounted for actions against 95 companies in total–26 of them public.
Over 50 of the enforcement actions on public company and subsidiaries targeted investment advisers or brokers–a nod to SEC chairman Jay Clayton’s emphasis on protecting the retail investor since taking the helm.
The SEC settled with Mylan, KPMG and Fiat Chrysler this year, among others. The highest dollar figure settlement against a publicly traded company amounted to $147 million–the lowest maximum penalty for a public company in the report’s 10-year history.
Seventy-two percent of public companies that faced enforcement action settled by paying a fine and cooperating with the SEC. 20% paid a fine, but didn’t cooperate.
For all enforcement activity, including cases brought against individuals, the SEC took in $4.3 billion in fines and disgorgements, though a single case against a privately held real estate investing firm accounted for $1 billion of that amount. That’s up from $3.9 billion in penalties for 2018.
Enforcement activity by the Commodity Futures Trading Commission slowed to 63 from last year’s 83 cases, the agency said on Monday.
The derivatives regulator collected $1.3 billion in penalties and payments–a 40% jump year-over-year and the fourth highest in CFTC history.
