Practice Management

SEC strips enforcement director of formal investigation powers

Sam Bojarski / Mar 11, 2025
While the move could slow down the Commission's enforcement machinery, a formal order is not always necessary to bring an enforcement action.
In a final rule published on Monday, the Securities and Exchange Commission (SEC) removed its enforcement director’s authority to issue formal orders of investigation. 
Such formal orders give enforcement staff the authority to issue subpoenas in connection with investigations tied to federal securities laws, according to a rule document published by the SEC. The new ruling is intended to align investigative resources with Commission priorities.
Citing sources with knowledge of the situation, media outlets reported in February that lawyers had been told they need to seek permission from the SEC’s politically appointed commissioners before launching investigations. Some legal analysts predicted the issuance of Monday’s formal order, which rescinded a 2009 rule delegating formal investigation authority to the SEC’s enforcement division chair. 
Enforcement staff will now have to prepare a formal order proposal and action memorandum, the latter of which would be circulated for comment to relevant...
CITYWIRE RIA
More News
Practice Management
How the SEC outsources exam functions
citywire ria
Mar 18, 2025
To read the full article, become an RIA Insider. You'll also gain complimentary access to news, insights, tools and more.
REGISTER NOW
Already an Insider?Log In
All content on this page is drawn from unaffiliated publications. Content on this site is not intended to provide, and should not be interpreted as legal, tax, investment or insurance advice, or recommendations by any party. Capital Client Group, Inc. is not responsible for content created by third parties and they do not explicitly or implicitly endorse or approve such content. Copyrights are held by the individual publications to which each article is attributed.