Insider Trading and Undisclosed SEC Probes

The U.S. Securities and Exchange Commission (SEC) has a three-part mission: to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation. SEC investigations and enforcement actions play a critical role in carrying out each of these objectives. One of the hallmarks of the investigative process is that it is shrouded in secrecy: The SEC explicitly seeks to protect the identity of those under investigation (SEC, 2017; SEC, 2019). With respect to corporate malfeasance, only SEC staff, senior managers of the company being investigated, and outside counsel are aware of active investigations. While some companies choose to disclose … Read more