July 9, 2019

SEC Will Evaluate Settlement Offers & “Bad Actor” Waiver Requests Simultaneously

Last week, SEC Chair Clayton issued this statement indicating that Enforcement will process settlement offers at the same time that “bad actor” waiver requests are made if so requested by the settling party. Here’s an excerpt from the Chair’s statement (we’re posting memos in our “SEC Enforcement” Practice Area):

I have consulted with the Office of the General Counsel and the Division of Enforcement regarding the mechanics of the Commission’s consideration of a simultaneous offer of settlement and waiver request. Based on these discussions, I generally expect that, in a matter where a simultaneous settlement offer and waiver request are made and the settlement offer is accepted but the waiver request is not approved in whole or in part, the prospective defendant would need to promptly notify the staff (typically within a matter of five business days) of its agreement to move forward with that portion of the settlement offer that the Commission accepted.

In the event a prospective defendant does not promptly notify the staff that it agrees to move forward with that portion of the settlement offer that was accepted (or the defendant otherwise withdraws its offer of settlement), the negotiated settlement terms that would have resolved the underlying enforcement action may no longer be available and a litigated proceeding may follow.

Tomorrow’s Webcast: “Current Developments in Capital Raising”

Tune in tomorrow for the webcast – “Current Developments in Capital Raising” – to hear Skadden’s Ryan Dzierniejko, Locke Lord’s Rob Evans, Shearman & Sterling’s Lona Nallengara and Wilson Sonsini’s Allison Berry Spinner explore the latest developments in raising capital and all the various alternatives, including ICOs, PIPEs and registered direct offerings, “at-the market” offerings, equity line financings and rights offerings.

Financial Reporting Structures: The Charts

Here’s an odd page that a member spotted on the SEC’s website. It contains three charts related to financial reporting structures: a blue print; a flow chart; and a segment chart. They were authored in the Spring of 2018 by Wes Bricker and Ying Compton from the SEC’s Office of Chief Accountant. Even though most companies will have their own unique circumstances, these could be useful as a “gut check”…

Broc Romanek