Commission Publishes FY23 Enforcement Statistics
The Commission and the Division of Enforcement published a release detailing the results of the Enforcement program for Fiscal Year 2023 (here). The headline asserts that 784 enforcement actions were filed during the period, nearly $5 million in financial remedies imposed and nearly $1 billion was distributed to harmed investors. By any standard, these are impressive numbers.
The balance of the release amplifies and clarifies the numbers by providing details and examples of the results in three areas. First, another table clarifies the 784 number. This table states that in FY 2023 the Division of Enforcement filed 501 enforcement action if follow-on administrative proceedings and delinquent filing cases are not included in the total number of cases. That number is the second highest over a period tracing back to FY 2018. The largest number of cases filed in that period was 526 in FY 2019. FY 2023 represents the second largest number of case initiated during the period while the 490, filed in FY 2018, was third.
A second amplification comes in a table which shows the number of cases filed broken down by category. This “Primary Classification” chart lists 13 categories of cases. Four classifications in FY 2023 were the largest: Securities offering at 33% of the total cases filed; Investment advisers/investment companies, a tie for second/third place at 14%; and in third place was broker dealers cases at 12% of the total. The remaining categories or classifications listed had relatively small percentages of the overall total number of cases filed.
Third, the press release discussed select cases in a number of broad areas which differed from those in the table discussed above. The first category, for example, is the protection of investors and the integrity of the markets. This category was broken down into a series of sub-areas. An example of market shaping actions – one subcategory in the group — are those brought to enforce the new marketing rule that applies to investment advisers. There the agency filed a series of actions against advisors who failed to have policies and procedures in place to ensure proper enforcement of the new rule. Similarly, the release highlighted cases brought to protect whistleblowers.
Another group of cases focused on “accountability and remedial measures against individuals.” Examples of actions filed here included one against a Wells Fargo executive who was barred from serving as an officer or director of a public company for misleading investors involving certain disclosures.
A third category was “holding fraudsters accountable for preying on retail investors.” The examples of cases initiated involved affinity frauds and Ponzi schemes.
Crypto was another key area of focus. Cases in this group were initiated, according to the release, for the sale of unregistered securities. Similarly, actions were filed against those who failed to register and market professionals.
A final example the categories cited involved the FCPA. Here the release discussed two significant cases in which violations of the statutes were uncovered involving large, international issuers who were sanctioned. Overall, the release cited to a series of examples to illustrate the breach and scope of the actions investigated and initiated in an effort to protect investors and the markets.
Commission Publishes FY23 Enforcement Statistics
The Commission and the Division of Enforcement published a release detailing the results of the Enforcement program for Fiscal Year 2023 (here). The headline asserts that 784 enforcement actions were filed during the period, nearly $5 million in financial remedies imposed and nearly $1 billion was distributed to harmed investors. By any standard, these are impressive numbers.
The balance of the release amplifies and clarifies the numbers by providing details and examples of the results in three areas. First, another table clarifies the 784 number. This table states that in FY 2023 the Division of Enforcement filed 501 enforcement action if follow-on administrative proceedings and delinquent filing cases are not included in the total number of cases. That number is the second highest over a period tracing back to FY 2018. The largest number of cases filed in that period was 526 in FY 2019. FY 2023 represents the second largest number of case initiated during the period while the 490, filed in FY 2018, was third.
A second amplification comes in a table which shows the number of cases filed broken down by category. This “Primary Classification” chart lists 13 categories of cases. Four classifications in FY 2023 were the largest: Securities offering at 33% of the total cases filed; Investment advisers/investment companies, a tie for second/third place at 14%; and in third place was broker dealers cases at 12% of the total. The remaining categories or classifications listed had relatively small percentages of the overall total number of cases filed.
Third, the press release discussed select cases in a number of broad areas which differed from those in the table discussed above. The first category, for example, is the protection of investors and the integrity of the markets. This category was broken down into a series of sub-areas. An example of market shaping actions – one subcategory in the group — are those brought to enforce the new marketing rule that applies to investment advisers. There the agency filed a series of actions against advisors who failed to have policies and procedures in place to ensure proper enforcement of the new rule. Similarly, the release highlighted cases brought to protect whistleblowers.
Another group of cases focused on “accountability and remedial measures against individuals.” Examples of actions filed here included one against a Wells Fargo executive who was barred from serving as an officer or director of a public company for misleading investors involving certain disclosures.
A third category was “holding fraudsters accountable for preying on retail investors.” The examples of cases initiated involved affinity frauds and Ponzi schemes.
Crypto was another key area of focus. Cases in this group were initiated, according to the release, for the sale of unregistered securities. Similarly, actions were filed against those who failed to register and market professionals.
A final example the categories cited involved the FCPA. Here the release discussed two significant cases in which violations of the statutes were uncovered involving large, international issuers who were sanctioned. Overall, the release cited to a series of examples to illustrate the breach and scope of the actions investigated and initiated in an effort to protect investors and the markets.