The U.S. Securities and Exchange Commission held its annual SEC Speaks conference on May 19 and 20, 2025, in Washington, D.C. On the second day of the conference, the Staff of the Division of Enforcement hosted two panel discussions and provided updates on what to expect from the Division going forward under the new administration. Several of the changes announced could prove transformative to the SEC’s Enforcement Program and greatly impact clients and the way defense counsel defends clients in SEC investigations. The following are highlights from the Division’s panel discussions:
Enforcement to Focus on the Frauds that Harm Retail Investors and Seniors
The biggest change in how resources are being allocated is a renewed focus on fraud, including insider trading, accounting and financial disclosures, and breaches of fiduciary duties. The Division is going to be less focused on violations that do not involve fraud, especially when the conduct has been fully remediated. Further, there is a major focus on frauds that target and harm retail investors and seniors and increasing attention to dangerous foreign actors.
Refocus on Individual Liability
There is going to be an emphasis placed on individual accountability in corporate investigations. The Division is going to consider the following factors when determining an individual’s accountability: the culpability of the individual, the severity of the individual’s misconduct, and the degree to which the individual tolerated illegal activity or tried to prevent the harm from occurring. The Division will also consider whether to seek prophylactic relief against individuals who engage in corporate misconduct by considering the egregiousness of the individual’s actions, the isolated or recurrent nature of the infraction, and the likelihood that misconduct will re-occur.
Enhanced Benefits of Self-Reporting, Cooperation, and Remediation
The Division is stepping up the benefits of self-reporting, cooperation, and remediation. The benefits can include not bringing any enforcement action when these steps have occurred. They also can include not requiring outside monitors where full remediation has occurred.
No Credit for Waiver of Attorney-Client Privilege
Consistent with Chairman Atkin’s position, the Division will not give cooperation credit for waiver of the attorney-client privilege. This policy change is to provide renewed respect for the importance of the advice of counsel and the attorney-client privilege.
Formal Orders Authorized by the Commission Only
Formal Orders of Investigation will now be authorized directly by the Commission. In 2009, the Commission delegated its Formal Order authority to the Director of Enforcement. In March 2025, the Commission eliminated the delegation of Formal Order authority.
Transparency and Access to Investigative Files
In a major shift, the Division is implementing an “open jacket policy” in which the Staff will disclose and present defense counsel with the evidence they have against the prospective defendant before recommending charges to the Commission. This is similar to reverse proffers in the criminal context.
More Access to the Front Office
The Director and Deputy Directors will grant Wells meetings if parties request them. However, defense counsel is not entitled to multiple meetings with the leadership of the Division.
New Structure of the Enforcement Division
There are now four Deputy Directors of Enforcement instead of one. Three oversee geographic areas, and one oversees the Specialized Units. The newly created National Enforcement Liaison is responsible for strengthening relationships with federal, state, and local partners.
Reorganization of Specialized Units
The Specialized Units have been reorganized Under Deputy Director Jason Burt as follows:
- Asset Management Unit: This unit focuses on violations of securities laws in the asset management industry, particularly cases involving misappropriation and failure to safeguard assets.
- Cyber and Emerging Technology Unit: This unit was formed in February 2025, and it focuses on many things. Currently, the unit is in the process of creating a way to verify identity in the space of emerging technologies and the misuse of technology to commit fraud. The unit will also focus on the terminology and or excitement around new industry-changing technology. They will also focus on blockchain and crypto asset-related fraud.
- Complex Financial Instruments Unit: This unit focuses on investigations related to complex financial instruments, such as security-based swaps. A major emphasis of the unit will be on complex financial investments sold to retail investors.
- Market Abuse Unit: This unit will investigate cases involving insider trading, with a focus on serial insider trading and large insider trading rings, as well as market manipulation. The unit’s investigations will include trading on alternative trading systems.
- Public Finance Abuse Unit: This unit investigates cases related to municipal bond securities. They will focus primarily on offering fraud. There will also be a focus on the municipal advisors and whether they are registered and the duties that they have, which are very similar to the duty fiduciary duty, that exists between an investment advisor and its client.
- Office of the Whistleblower: The new focus of the Whistleblower’s Office is going to be on moving forward or denying claims as quickly as possible and reducing submissions from serial frivolous submitters.
Click here to watch the SEC Speaks conference: