SEC will no longer silence settling defendants, says Paul Atkins
The U.S. Securities and Exchange Commission has rescinded its decades-old policy that barred defendants in enforcement settlements from publicly denying the agencys allegations.The SEC has removed its long-standing rule that barred settling defendants from publicly denying enforcement allegations.SEC Chair Paul Atkins said the policy created unnecessary limits on criticism of the agency during settlement agreements.Commissioner Hester Peirce said allowing both sides to speak freely would improve transparency around SEC enforcement actions. In a statement released Monday, the U.S. Securities and Exchange Commission said the repeal removes a rule first adopted in 1972 that required settling parties to agree not to challenge the agencys claims in public. Regulators said the policy had created the impression that the SEC was attempting to insulate itself from criticism, while also placing the agency out of step with most other federal regulators. “For more than 50 years, the Commission has conditioned settlement on a defendant‘s promise not to publicly deny the Commission’s allegations. I am pleased that we are rescinding the no-deny policy today,” SEC Chair Paul Atkins said. “This rescission ends the policy prohibiting such criticism by settling defendants.” Under the old framework, companies or individuals settling with the SEC could neither deny the allegations nor allow