The future of SEC enforcement under the Biden administration

Abstract

Purpose

To examine what to expect from Chair Gary Gensler’s SEC and the new Biden presidential administration following Chair Gensler’s U.S. Senate confirmation on April 14, 2021.

Design/methodology/approach

Reviews past SEC Chair Jay Clayton’s legacy and Chair Gensler’s prior regulatory actions and focus, and outlines Chair Gensler’s expected initiatives, including a heightened focus on cryptocurrency regulation, investigation of COVID-19-related fraud, and ESG and climate change disclosure.

Findings

This change will bring forth a Democratic majority at the SEC which, in turn, suggests that the Commission will change its current emphasis on capital formation to focus more on investor protection, rules required by the Dodd-Frank Act, inspections, examinations, and enforcement

Practical implications

Firms should examine their compliance programs in anticipation of heightened advocacy for investor protection; an increased focus on cryptocurrency and blockchain technology, as well as ESG disclosures with an emphasis on climate change; and an increase in inspections and examinations which will drive more enforcement in the fund industry, as well as increases in initiatives regarding transparency, additional disclosures, and investor protection. Organizations will also benefit by reexamining their existing compliance programs with the advice of counsel as a mechanism to mitigate the risk of potential securities laws violations.

Originality/value

Practical guidance from experienced securities enforcement and litigation lawyers.

Citation

Carney, J.J., Barr, J.R., Guillén, T.G., Fokas, J., Edgar, K.R., Tanney, M., Nadworthy, B. and Gaudreau, M. (2021), "The future of SEC enforcement under the Biden administration", Journal of Investment Compliance, Vol. 22 No. 4, pp. 334-339. https://doi.org/10.1108/JOIC-06-2021-0030