SEC Commissioner pledges prior notice to firms before enforcement action

U.S. Securities and Exchange Commission (SEC) Commissioner Paul Atkins said the agency will provide companies with prior notice before taking enforcement action, according to an interview with the Financial Times. He stated that this marks a complete departure from the enforcement-first approach of the Biden administration. Atkins explained that the SEC will inform companies before launching compulsory investigations, emphasizing that the agency was founded to pursue fraudsters, not businesses. He argued that in recent years, the SEC had failed to follow precedent and disregarded predictability, effectively shooting first and asking questions later, which he described as an unreasonable form of regulation. Additionally, Atkins referenced the collapse of FTX, noting that while many people lost funds in the incident, assets in the U.S. derivatives sector were safely protected and returned to customers. He added that this serves as a prime example of how U.S. investor protection systems can help when offshore regulations prove insufficient.