The SEC’s Enforcement Drop Means Less Accountability for Financial Fraud

Investors now face reduced deterrence against financial misconduct and diminished recovery of illicit gains. The SEC brought 30 percent fewer enforcement actions in the first year of the Trump administration. Financial fines collected by the SEC dropped by 45 percent. Disgorgement orders, which require companies to return ill-gotten profits, fell by 98 percent. Staffing in the SEC’s enforcement division declined by 17 percent. The SEC’s enforcement chief resigned after clashing with political appointees over pursuing fraud cases involving the president’s circle. The SEC appointed David Woodcock, a former defense attorney for companies facing SEC actions, as the new enforcement chief.