Gurbir Grewal Appointed New Director Of SEC Enforcement Division | Man’s pepper with trout



The Securities and Exchange Commission (SEC or Commission) has announced that New Jersey Attorney General Gurbir Grewal will become the next director of its Enforcement Division, [1] after resigning as New Jersey attorney general on July 26. Grewal’s appointment follows President Biden’s confirmation in April of Gary Gensler as the new chairman of the SEC.

In his new role, Grewal and his staff will oversee the application of federal securities laws to protect investors and maintain market integrity by investigating possible violations of federal securities laws, by pursuing the Commission’s civil proceedings in federal courts and by processing administrative procedures.

Grewal comes to the Enforcement Division with significant prosecution experience and is expected to continue the aggressive enforcement of the Financial Crimes Division. [2]

During the tenure of the former Co-Directors of Enforcement under the Trump administration – Stephanie Avakian and Steven Peikin – the Enforcement Division was extremely active. The Division initiated more than 3,000 enforcement actions, obtained more than $ 17 billion in financial remedies, awarded approximately $ 3.6 billion to investors and paid approximately $ 595 million to whistleblowers. Additionally, despite the impact of COVID-19 and the temporary closure of the physical offices of the Enforcement Division, the Enforcement Division experienced a record fiscal year in 2020. The Division initiated 715 enforcement actions. enforcement covering a wide range of issues, including financial fraud; fraudulent offer; issuer disclosure and accounting violations; violations of the Corrupt Practices Abroad Act; investment advice matters; securities offers; market manipulation; insider trading; and broker misconduct. In 2020, the Law Enforcement Division’s Office of Market Intelligence also opened more than 150 COVID-19 investigations and inquiries. [3] Thanks to these actions, the SEC obtained record monetary remedies in its enforcement actions in 2020 – with judgments and orders totaling about $ 4.68 billion in restitution and penalties. The SEC also awarded a record $ 175 million to 39 whistleblowers in 2020, for both the highest amount and most people. [4]

Investigations under Grewal’s leadership are likely to continue at least at the current rate, if not increasing, given the Biden administration’s interest in aggressively tackling financial fraud. Additionally, President Gensler’s previous regulatory guidance and actions while at the Commodity Futures Trading Commission suggest he will push forward an investor protection agenda. As such, the division will likely continue to track some application trends related to the pandemic and recession from 2020, as well as focus on the challenges presented by fraud and cryptocurrency manipulation. . In addition, the division will likely focus on issues relating to environmental, social and corporate governance (ESG) disclosures, given the early attention of the Biden administration and Gensler to this area and the creation of a ESG working group within the Enforcement division. Over the coming year, the SEC may review whether certain entities have adequate policies in place to support their ESG reporting. In addition, the Division should continue to increase its reliance on whistleblowers in line with its most recent trends.

In its 2020 Annual Report, the Enforcement Division noted a continued focus on accelerating the pace of investigations, expressing a desire to reduce the time it takes to bring financial fraud and disclosure cases to the bank. issuer, while shortening the time it takes to complete investigations and recommend enforcement action. [5] The SEC has already made some efforts in 2021 to speed up the pace of enforcement, announcing it would allow senior enforcement officials to issue “formal investigative orders.” [6]

In addition, the Division has expressed its continued concern to hold individuals accountable for enforcement actions. This continues a trend from 2020, where the SEC held individuals – including CEOs, CFOs, accountants and auditors – accountable in about three out of four stand-alone enforcement actions. The Division is further committed to rewarding the voluntary, timely and meaningful cooperation of defendants.

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[2] Gurbir Grewal has served as a prosecutor at local, state and federal levels. Grewal had been Attorney General for New Jersey since 2018 and prior to that position he was a Bergen County District Attorney. Grewal previously served as the Federal Prosecutor in the Criminal Division of the United States Attorney’s Office for the District of New Jersey (as Head of the Economic Crimes Unit) and in the Eastern District of New York from 2004 to 2007 (where he was assigned to the Corporate and Securities Fraud Unit). He served as lead prosecutor in the largest known data breach lawsuit and other major financial fraud cases. Prior to working as a federal prosecutor, Grewal also worked in private practice, representing individuals and businesses in government and internal investigations, criminal proceedings and civil trials. Grewal is a graduate of Georgetown University School of Foreign Service and the College of William & Mary, School of Law.

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