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Abstract: 

The last quarter of 2024 was especially active, with several significant enforcement actions involving accounting and financial reporting including some with significant civil penalties. With the new presidential administration in 2025, the SEC has begun to adjust its regulatory agenda but is expected to continue its enforcement focus on core issues of accounting and financial reporting including internal controls and disclosure controls. What is likely to change, going forward, is the remedy sought for violations, in particular, civil penalties against public companies. Paul Atkins, President Trump’s nominee to serve as SEC Chair, during his prior tenure as SEC Commissioner, questioned the appropriateness of civil penalties against public companies the cost of which is largely borne by shareholders, as opposed to wrongdoers involved in the misconduct. A civil penalty may no longer be the default remedy for public companies charged with accounting and reporting violations. Rather, we can expect thorough consideration by the SEC when determining whether a civil penalty is warranted, as well as the appropriate amount of the penalty.

Keywords: 2024 Enforcements: Becton, Dickinson, and Company; Entergy Corp; United Parcel Service Inc. (“UPS”); Portland General Electric Co. (“Portland GE”); SolarWinds Corp.; Paul Atkins

Affiliations:  1: Baker Hostetler; 2: Baker Hostetler.