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SEC takes steps to stem courtroom defeats

Publisher: Wall Street Journal
Author: Jean Eaglesham

Faced with a recent string of courtroom defeats, the Securities and Exchange Commission is changing the way it prepares for trials.

SEC Chairwoman Mary Jo White has taken steps to restructure the agency’s trial unit in order to foster a more collaborative environment between investigators and litigators with the hope that it will improve the SEC’s successful conviction rate. Since October of last year, the SEC has won 55% of its trials. That percentage is a steep drop from its three consecutive years of achieving a win rate of over 75%. Defense lawyers have suggested that lowered success rate of the SEC may encourage more people to fight allegations instead of settling. In the past, Mrs. White stated that the agency’s then-80% courtroom success rate “may explain why most lawyers counsel their clients against going to trial against the SEC and why we achieve strong settlements in most of our cases.”

What are your thoughts on the Mrs. White’s commitment to stringent enforcement of insider trading cases?

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