On May 19, 2026, the Securities and Exchange Commission (SEC) proposed amendments in a “Registered Offering Reform” package (the Proposal) that would make it significantly easier for public companies to raise capital through registered offerings of securities. Notably, among other changes, the Proposal would exempt all registered public offerings, including those for non-exchange traded products sold through private wealth channels such as real estate investment trusts (REITs) and business development companies (BDCs), from state blue-sky registration and qualification requirements. This preemption of state blue-sky registration requirements, if adopted as proposed, would likely alleviate the regulatory burden imposed on non-traded REITs and BDCs that elect to conduct registered public offerings of their shares significantly and expand the scope of retail investors who participate in such offerings due to the lack of separate state blue-sky suitability requirements with respect to such investors. The Proposal also seeks to modify a number of other registered offering-related items, including with respect to the eligibility of certain issuers, like registered closed-end funds and BDCs, to rely on shelf registration statements, as described more in another recent Cleary Gottlieb publication.
Continue Reading SEC Proposes Registered Offering Reform: Blue-Sky Preemption a Key Win for Non-Exchange Traded REITs and BDCsSEC Developments
Deny With Care: SEC Rescinds Settlement “Gag Rule,” Creating Risks and Opportunities for Settling Defendants
Yesterday, the Securities and Exchange Commission rescinded its so-called “gag rule,” which for fifty years had prohibited a settling defendant from publicly denying the allegations in a settled SEC Enforcement action.[1] The policy shift has received significant media attention, but we believe it will have little effect on the experience of most individuals and entities facing SEC investigation, many of whom are keen to resolve an investigation and move on without drawing additional attention to themselves. But the change does create potential pitfalls for those trying to resolve SEC investigations, and heightens the need to think strategically when negotiating resolutions and pursuing public denials of wrongdoing. We have investigated, settled, and litigated numerous SEC enforcement investigations, both on behalf of the agency and in private practice. Outlined below are some of the potential knock-on effects we see from this policy change.
Continue Reading Deny With Care: SEC Rescinds Settlement “Gag Rule,” Creating Risks and Opportunities for Settling DefendantsNew SEC Enforcement Director David Woodcock Outlines Enforcement Priorities, Including Focus on Financial Reporting and Private Funds
In his first public remarks, delivered just days into his tenure, SEC Enforcement Division Director David Woodcock announced that he will “provide hands-on leadership” to make sure SEC Enforcement investigators “focus on the fundamentals,” which he defined as “protecting investors and safeguarding markets from real harm.”[1] In announcing his “back-to-basics” approach, Woodcock gave top billing not just to traditional scams, but also to cases involving financial reporting and private funds and investment advisers. Woodcock’s remarks and his prior tenure at the SEC—and our own work on recent and ongoing SEC investigations and resolutions—indicate that the agency will continue to pursue these often complex cases even when they do not find or charge fraud, perhaps to the surprise of commentators who prematurely announced the demise of SEC Enforcement.
Continue Reading New SEC Enforcement Director David Woodcock Outlines Enforcement Priorities, Including Focus on Financial Reporting and Private FundsSEC and CFTC Jointly Propose Amendments to Reduce Form PF Reporting Burdens
By Amber V. Phillips, Ben Rosenblum & James Gordy on
On April 20, 2026, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) (collectively, the Commissions) jointly proposed amendments to Form PF, which if passed, would increase certain reporting thresholds, eliminate certain filing and reporting obligations, and streamline various other requirements, with the goal of reducing reporting burdens while continuing to collect information needed for investor protection and systemic risk monitoring (the Proposal).
Continue Reading SEC and CFTC Jointly Propose Amendments to Reduce Form PF Reporting BurdensEnforcers Target Fund Valuation Practices
Posted in Corporate Enforcement, DOJ, DOJ Developments, Enforcement, SEC Developments, United States
Fund valuation practices have been a recent focus of the SEC and, increasingly, federal prosecutors. Two enforcement actions settled in recent weeks make clear that the SEC is actively pursuing a broad array of valuation-related cases, from the use of allegedly inadequate methodologies to audit failures. In addition, private credit fund valuations are under pressures as lenders and other market participants have begun to mark down collateral values even where the funds have yet to do so themselves. Based on recent statements by senior SEC and DOJ leadership, and in view of recent headlines citing private credit risk, we expect more cases will follow.
Continue Reading Enforcers Target Fund Valuation PracticesThe Shifting SEC Enforcement Landscape: 2025 Year-in-Review
The following is part of our annual publication Selected Issues for Boards of Directors in 2026. Explore all topics or download the PDF.
Fiscal year 2025 was a year of extremes in terms of the number of enforcement actions brought by the Securities and Exchange Commission (SEC). During the first quarter of fiscal year 2025 (October through December 2024), the SEC reported a record-breaking number of enforcement actions.[1] However, for the remainder of the fiscal year, the SEC’s enforcement numbers significantly declined. Despite the reduction in enforcement actions seen in the second half of the year, there are early indications that enforcement under the second Trump administration is not disappearing but instead shifting focus. Public companies should expect continued SEC enforcement focused on fraud and harm to investors, and should remain mindful of the SEC Enforcement Division’s emphasis on voluntary report and cooperation.
Continue Reading The Shifting SEC Enforcement Landscape: 2025 Year-in-ReviewSEC Exam Priorities 2026 Priorities Largely Consistent: Will Approach to Deficiencies and Enforcement Referrals Change?
The U.S. Securities and Exchange Commission (“SEC”) Division of Examinations (the “Division”) released its 2026 examination priorities on November 17, 2025 (the “2026 Priorities”). As expected from the new leadership, the 2026 Priorities signal less (but still present) focus on private fund advisers and more focus on retail advisers and emerging technologies such as AI and algorithmic advice. Overall, the extremely high overlap in priorities from prior years is notable, leading our main takeaway from the 2026 Priorities to be whether and how the Division Staff will emphasize public messages such as Risk Alerts and Exam Observations compared to private actions like detailed deficiencies and numerous referrals to the Enforcement Division.
Continue Reading SEC Exam Priorities 2026 Priorities Largely Consistent: Will Approach to Deficiencies and Enforcement Referrals Change?SEC Staff Reverses Some “Gross/Net” Marketing Rule Guidance
On Wednesday evening, the SEC Staff published two new FAQs relating to the presentation of gross and net performance under the Investment Advisers Act Marketing Rule, the sweeping 2022 overhaul of the advertising and endorsement restrictions applicable to registered investment advisers (“RIAs”). Both FAQs provide significant relief from prior Staff interpretations of the Marketing Rule and will dramatically reduce compliance burdens for RIAs in the areas of performance of individual investments and certain performance “characteristics” of portfolios and investments. The limited open questions raised by new FAQs pale in comparison to the issues RIAs faced with the prior interpretations.
Continue Reading SEC Staff Reverses Some “Gross/Net” Marketing Rule GuidanceSEC Adopts Rules Requiring Daily Computation of Customer and PAB Reserve Requirements for Certain Broker-Dealers
On December 20, 2024, the Securities and Exchange Commission (the “SEC”) adopted amendments to Exchange Act Rule 15c3-3 (the “Customer Protection Rule”) to require carrying broker-dealers with $500 million or more in average total credits to perform the customer and PAB (i.e., proprietary accounts of broker-dealers) reserve account computations and make any required deposits daily, rather than weekly (the “Final Rules”). Approved by a 4-1 vote,[1] the Final Rules included several changes from the proposed rules, which we discussed in our prior Blog Post.
Continue Reading SEC Adopts Rules Requiring Daily Computation of Customer and PAB Reserve Requirements for Certain Broker-DealersSEC FY 2024 Enforcement Results: Record Dollars But Many Fewer Cases
By Robin M. Bergen, Matthew C. Solomon, Tom Bednar, Jackie M. Brune, Jordan Michael Christian & Emily N. Janikowski on
On November 22, the Securities and Exchange Commission announced its enforcement results for the 2024 fiscal year with a record $8.2 billion in financial remedies.[1] At the same time, a few cases and sweeps comprised the vast bulk of that amount, and the number of cases brought dropped by 26%. In a press release announcing the results, Acting Enforcement Director Sanjay Wadhwa touted the agency’s “high impact enforcement actions” and noted “stepped up efforts” by market participants to self-report their own potential wrongdoing, cooperate in SEC investigations, and remediate any shortcomings. Chair Gary Gensler, who recently announced he will step down at the start of the next Trump presidency, described the Enforcement Division as a “steadfast cop on the beat.” Set forth below are key highlights on enforcement trends from the past year, as well as predictions for what the next year may hold under a new administration.
Continue Reading SEC FY 2024 Enforcement Results: Record Dollars But Many Fewer Cases