Admissions in SEC Enforcement Cases: The Revolution That Wasn't

72 Pages Posted: 13 Oct 2017 Last revised: 9 Aug 2022

See all articles by David Rosenfeld

David Rosenfeld

Northern Illinois University - College of Law

Date Written: 2017


In 2013, the SEC departed from its long-standing policy of settling enforcement matters on a no-admit/no-deny basis, and for the first time began to require admissions when settling certain cases. The new admissions policy was greeted with considerable concern by many who thought it would lead to fewer settlements, more litigation, and a decline in the effectiveness of SEC enforcement. After more than four years, a full assessment of the policy is in order. The SEC continues to report record enforcement numbers and has touted the admissions policy as a great success. However, this Article empirically demonstrates that the SEC has obtained admissions in a very small number of cases since adopting the new policy, and on only a few occasions in cases involving the most serious charges, namely scienter-based fraud. Moreover, it shows that the SEC has applied the new policy inconsistently and haphazardly, treating like cases differently—a problem that is compounded by a complete lack of transparency in the process. This Article contends that these trends reveal a deliberate strategy of accommodation on the part of the SEC, through which the agency has trumpeted a message of tough enforcement and public accountability, while in reality continuing business as usual. In light of these issues, this Article concludes that the admissions policy should be reconsidered or abandoned altogether.

Keywords: SEC, Securities and Exchange Commission, Enforcement, Admissions, Fraud, Settlement, Litigation, Scienter

JEL Classification: K22

Suggested Citation

Rosenfeld, David, Admissions in SEC Enforcement Cases: The Revolution That Wasn't (2017). 103 Iowa L. Rev. 113 (2017), Available at SSRN:

David Rosenfeld (Contact Author)

Northern Illinois University - College of Law ( email )

Swen Parson Hall
DeKalb, IL 60115
United States

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