SEC Chair White Speaks on Use of Civil and Criminal Actions to Police the Markets (with Lofchie Comment)

SEC Chair Mary Jo White delivered a speech about the SEC Enforcement program and its use of criminal, civil and regulatory tools to enforce securities laws. Chair White explained that the SEC's cooperation and partnership with criminal authorities is essential to enforcement efforts, since there are "no more powerful tools than a criminal conviction and the prospect – and reality – of imprisonment."

According to Chair White, the significant rise in criminal prosecutions of securities cases can be attributed to the SEC Enforcement staff's close work and parallel investigations with criminal authorities, such as the Department of Justice, the FBI, and state and local law enforcement. She also mentioned some of the tools that the SEC employs in standalone cases, such as the ability to bar wrongdoers from their particular roles in the securities profession and the entire securities industry, as well as obtain asset freezes, trading suspensions and temporary injunctions. Chair White then discussed three areas in which both the SEC's standalone tools and cooperation with criminal authorities come together to bring parallel cases: insider trading, microcap fraud and financial fraud.

Lofchie Comment: The Chair's remarks focused on SEC's activities with respect to criminal conduct. She did not mention the SEC's regulatory responsibilities, market structure issues or the role of financial intermediaries in the economy.

See: Chair White's Speech.