WASHINGTON – The Wall Street chief regulator will give more power to his enforcement staff to launch investigations, an early sign that he intends to become more assertive under the Biden government.
The move by the Securities and Exchange Commission allows more supervisory supervisors to authorize investigations, allowing about 36 senior officials at the agency to sue companies and individuals for records or evidence. During the Trump administration, the agency withdrew the authority of supervisors and allowed only two officials to approve new sins, saying it would lead to more consistent decisions about what tips and complaints warrant investigations.
“Restoring this authority to the experienced senior officers of the division, who have a proven track record of carrying it out with care, helps to ensure that investigative staff can work effectively to protect investors,” said Allison Herren Lee, acting chairman of the SEC, said Tuesday.
The number of new investigations dropped each year during the Trump administration, from 1,063 in 2016 to 827 in 2019, according to the most recent figures published by the SEC. The number of completed enforcement actions dropped from 548 in 2016 to 405 in 2020, although it reached 526 in 2019.
SEC staff can investigate suspected violations without obtaining approval for a formal investigation. But the informal inquiries are supposed to take only 60 days before they have to be closed or turned into an investigation.