Securities

New SEC Enforcement Action Database from NYU and Cornerstone Research

 On October 27, 2015, Cornerstone Research in conjunction with the New York University Pollock Center for Law & Business and the Leonard N. Stern School of Business to launch the Securities Enforcement Database (SEED). As described in the organizations’ joint October 27, 2015 press release (here), the database will track record and information relating to SEC enforcement actions filed against public companies. The SEED database, which can be found here, will facilitate the analysis of and reporting of SEC enforcement actions through regular updates of new filings and settlement information relating to ongoing enforcement action.

The database reflects data on SEC actions filed since October 1, 2009. Variables tracked will include defendant names and types, violations, venues and resolutions. While the SEED database will focus initially on public companies, the organizations report that the database will eventually expand to include other types of defendants.

The database will afford access to searchable data to provide insight into multiyear trends and enforcement priorities. The plan is that the database will also be used to provide regular reports on developments and trends. A portion of the database will be available to the general public, and a more extensive version will be available for academic scholars.

For years commentators and practitioners have enjoyed the benefits of access to the securities class action litigation database that Cornerstone Research maintains in conjunction with the Stanford Law School. This new database should afford the same kind of analysis and reporting with respect to SEC enforcement actions. The new database should be a great resource for anyone hoping to obtain an understanding of the SEC’s enforcement activity involving public companies.

By way of illustration of the kinds of insights the database may afford, the website has a bar graph on its how page showing the distribution of SEC enforcement actions between civil actions and administrative actions. The bar graph unmistakably shows that the during the period 2010 to 2015YTD, the agency has increasingly been making use of administrative procedures, a fact that is highly relevant in the current controversies surrounding the agency’s use of its administrative courts. Further comparative analysis of the data in the database can be found here. The bar graphs showing the distribution of actions against public companies by allegation type during the period 2010-2015YTD is also very interesting.

Readers who may want to familiarize themselves should try to website’s search function. For example, a search on the company name Avon Products takes you to this page reflecting the SEC’s FCPA enforcement action against the company, including the amount of the total penalties and disgorgements (reported to be $135,013,013). If you wanted to see a list of all of the FCPA enforcement actions in the database, you would just choose “Foreign Corrupt Practices Act” from the dropdown menu on the search page, which would take you to this list of the FCPA enforcement actions in the database.

It is clear that this database is going to be a very valuable tool for observers and practitioners to use to find out information about individual enforcement actions as well as about categorical trends over time.

 For more news and commentary on developing securities issues, visit SEC Actions, a blog by Thomas Gorman.

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