The SEC has implemented a new procedure that requires high-level permission before beginning official investigations. This change might hold down enforcement proceedings.
In the past, agency workers were able to start investigations on their own, but today subpoenas cannot be issued unless they have been approved by politically selected leadership.
This move comes after Donald Trump returned to office. The SEC is now being run by interim chair Mark Uyeda, along with commissioners Hester Peirce and Caroline Crenshaw. He is anticipated to take over as chair once Paul Atkins, the previous commissioner, is confirmed.
The ruling has received a variety of responses. Some people believe that tougher monitoring would avoid investigations that are not necessary, while others fear that it will make it more difficult for the SEC to take quick action against malfeasance. The agency has refused to say if the move was voted on formally or who gave the approval for it.
The enforcement capabilities of prior administrations have differed. For example, during Trump’s first term, probes needed dual authorization, whereas Biden’s SEC enabled lower-level lawyers to continue with inquiries more freely. The most recent policy gives commissioners more authority to enforce regulations, which might indicate that the government is taking a more business-friendly approach to regulation.
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