On November 15, 2022, the Securities and Exchange Commission announced the results of its Division of Enforcement activity for the 2022 fiscal year. Actions speak louder than words and—while the Commission issued several significant “proposed rules” during the past year, including enhanced disclosures about Environmental, Social, and Governance (ESG) investment practices and new disclosure rules for Special Purpose Acquisition Companies (SPACs)—the Division’s actual enforcement activity over the last year is a better indicator of where the SEC is likely to direct its enforcement resources for the upcoming year.
First, how did this year compare to last year? In FY 2022, the Commission filed 760 total enforcement actions, a 9% increase over the previous year. Someof this increase may be due to a slowdown in prior years because of COVID-19. Money ordered in SEC actions, including civil penalties, disgorgement, and prejudgment interest, totaled $6.4 billion, the most on record in SEC history. Civil penalties, at $4.2 billion, were also the highest on record, while disgorgement, at $2.2 billion decreased by 6% from fiscal year 2021. (The decrease in disgorgement may be a result of recent Supreme Court decisions placing some limitations on the SEC’s ability to obtain disgorgement.). Also notable is this year’s number of individual whistleblower awards and the total dollar amounts awarded, both of which were the second highest ever.
Second, what…
