Nelson Comments on Restoration of SEC Enforcement Division’s Investigative Power

09 February 2021 Law360 News

Partner Margaret Nelson was quoted in a Law360 article, “SEC Enforcement Gets Obama-Era Investigative Power Back,” about acting U.S. Securities and Exchange Commission Chair Allison Herren Lee’s announcement that the agency is reverting to the use of delegated authority, a policy that allows senior members of the enforcement division to approve the issuance of a formal order of investigation, which must be obtained before the agency can subpoena documents and take sworn testimony.

 

Nelson, a former senior counsel at the agency, said she viewed the reinstatement as a “largely symbolic gesture,” one signaling that the commission under President Biden is going to be more enforcement-minded that it was under President Trump.

 

“One can infer from acting Chair Lee’s statement that the new commission  will be reverting back to its former pro-enforcement ways, and the enforcement staff will be empowered to bring quicker and more aggressive cases,” she said. “I suspect that acting Chair Lee did not feel the need to wait for Gary Gensler” – Biden’s nominee for SEC chairman – “to be confirmed to take this action, as it likely comports with his world view of the commission’s role.”

Insights