SEC Chairman Paul Atkins was sworn in last week and is set to preside over a newly restructured SEC after several departures linked to DOGE. Experts anticipate considerable changes in the rule-making agenda, though Atkins has a strong stance on enforcement actions.
Three of the last four general counsels of the Securities & Exchange Commission have forecasted shifts in enforcement priorities, yet expect them to persist under the leadership of newly appointed Chairman Paul Atkins. Atkins, who took his position last week, is not new to the SEC, having served as a commissioner from 2002 to 2008. As a known crypto enthusiast, he previously held up to $6 million in crypto-related assets. Despite predictions of lighter enforcement due to President Trump’s business-oriented policies, Melissa Hodgman, a former senior officer at the SEC’s Division of Enforcement, stated that enforcement will continue robustly under Atkins.
Hodgman explained that Atkins’ enforcement focus will likely highlight issues such as fraud, including accounting, disclosure fraud, and insider trading. Speaking at the Berkeley Spring Forum on M&A and the boardroom, Hodgman, now a partner at Freshfields, emphasized the importance of lawyers paying attention to executives and directors’ trading activities. She noted that regulators have become adept at linking insider trading cases using social media and AI.
The agency is likely to shift its focus on rule violations, according to three former SEC general counsels who discussed these changes on a panel moderated by Hodgman. Robert Stebbins, the SEC general counsel from 2017 to 2021, commented that enforcement might return to prioritizing "Main Street" or retail individual investors. He also noted the likelihood of no Foreign Corrupt Practices Act enforcement, as the Trump administration had paused it for economic competitiveness reasons.
Dan Berkovitz, general counsel under former Chairman Gary Gensler, indicated that enforcement will likely focus more on cases of investor harm rather than procedural breaches. Megan Barbaro, also general counsel under Gensler, suggested enforcement actions might involve lower corporate penalties due to concerns about adverse effects on shareholders.
In 2024, the SEC filed 583 enforcement actions, collecting over $8 billion in fines, despite a 26% decrease in cases. Former Chair Gensler faced criticism for his extensive rule-making agenda, including from Commissioner Hester Peirce regarding his approach to crypto regulation.
All three former chief lawyers expect Atkins to navigate crypto regulation delicately. On his fourth day as chair, Atkins participated in the SEC’s third Crypto Task Force roundtable, acknowledging Commissioner Peirce for her contributions.
In rule-making, the agency might act on environmental disclosures. In March 2024, the SEC adopted rules for greenhouse gas emissions disclosures, which faced legal challenges. Following Trump’s election, acting SEC Chairman Mark Uyeda announced the commission would no longer defend the climate-risk disclosure rule.
Berkovitch also noted potential regulatory focus on expanding private market access and raising the accredited investor threshold, which was last addressed in 2020 by broadening the definition of eligible investors and firms.
This article originally appeared on Fortune.com.
