April 3, 2026

SEC Speaks – Are You Listening?

Jasmine Chean, Allison Kernisky, Jessica Magee Holland & Knight LLP + Follow Contact LinkedIn Facebook X Send Embed

Leaders across the SEC convened in Washington, D.C., earlier this month for SEC Speaks in 2026, an annual gathering of SEC Commissioners and senior staff who discuss agency updates and focus areas for policy, rulemaking and enforcement.

This year's event featured a keynote address from Chairman Paul Atkins, statements from Commissioners Mark Uyeda and Hester Peirce and, among commentary from other divisions and offices, up-to-date information about the Commission's current enforcement philosophy and priorities – all tidily summarized below.

But First, an Important Item

Before SEC Speaks kicked off on March 19, 2026, SEC Enforcement Division Director Judge Margaret Ryan abruptly resigned her post at the agency on March 16, 2026, less than seven months into the job. Her surprise resignation was effective immediately and occurred just weeks after her first and only public remarks as director, which she offered at the Los Angeles County Bar Association's (LACBA) 56th Annual Securities Regulation Seminar on February 11, 2026.

In her remarks to the LACBA, Judge Ryan described an SEC Enforcement program grounded in integrity, honor, fidelity to the law and an unwavering commitment to the fair and judicious use of power and resources. In addition to signaling an already much-discussed break from the prior administration's approach to enforcement, Judge Ryan described a division focused on chasing down true "bad actors" where Enforcement staff – greatly reduced in numbers over the preceding months – are charged with prioritizing quality and impact of enforcement over volume of cases, reinvigorating the Wells process and taking a pragmatic approach to non-fraud compliance failures.

Following Judge Ryan's departure, Principal Deputy Director of Enforcement Sam Waldon was once again named Acting Director, a role he held prior to Judge Ryan's appointment and one of his many leadership positions during a long tenure with the agency spanning several administrations.

Tone at the Top

SEC Speaks featured a keynote address from Chairman Atkins and noteworthy speeches from Commissioners Uyeda and Peirce. These three are the Commission today, as the remaining two seats on the Commission – statutorily earmarked for Democrats – remain vacant. The trio's message is consistent: The SEC will not inhibit the free market by overstepping its regulatory authority.

| Chairman Atkins | Commissioner Uyeda | Commissioner Peirce |
| Chairman Atkins articulated the Commission's "ACT Strategy" – advance, clarify and transform – as the framework for the SEC's direction.

Advance: Advancing the SEC's regulatory posture to reflect how markets actually operate today. The SEC will lead with clear, flexible and firm rules that protect investors instead of inhibiting the market.

Clarify: Clarifying the SEC's jurisdiction and harmonizing with other agencies. The SEC will continue to work with Commodity Futures Trading Commission (CFTC) to reduce redundant compliance obligations.

Transform: Transforming the SEC's disclosure and compliance requirements. Trim mandates that burden markets without informing investors of what they consider important. | Commissioner Uyeda framed the SEC's role as the free market facilitator ensuring "clear rules, honest disclosure, and timely accountability for fraud and manipulation" so that investors have accurate, honest and financially material information to pursue their economic aspirations.

As a clear departure from the prior administration, the Commission is focused on:

• commitment to making public markets more accessible and less burdensome through modernizing the shelf registration process, overhauling Regulation S-K and recalibrating emerging growth company and smaller reporting company SRC thresholds
• democratization of private market investing for retail investors by lifting the 15 percent cap under ADI 2025-16 Guidance and working with the U.S. Department of Labor to provide fiduciaries guidance and protection
• fostering growth and acceptance of the crypto asset market by building a proper regulatory framework, developing innovation exemption to facilitate limited trading of tokenized assets and granting exemptive relief under the Investment Company Act of 1940 | The SEC's Disclosure Authority Has Hard Statutory Limits: The U.S. Congress gave the SEC a focused mandate to require disclosures that serve investors' financial interests – not open-ended power to elicit any information it wants.

Materiality Is the Essential Guardrail: Disclosure mandates must be tethered to information a "reasonable investor" would find significant to risk-adjusted economic returns – that's the U.S. Supreme Court standard, and it constrains the SEC.

The "Reasonable Investor" Cares About Financial Returns, Full Stop: Investors may have diverse personal motivations, but the common thread – and the only one the SEC should build rules around – is the pursuit of economic returns.

"Public Interest" Is Not a Blank Check: Broad statutory phrases such as "necessary or appropriate in the public interest" must be read in the context of the securities laws' financial mission; they do not authorize the SEC to regulate social or environmental policy.

The SEC Is a Disclosure Regulator, Not a Substantive Regulator: Using disclosure mandates to shape corporate behavior on environmental, social or other policy issues crosses the line from disclosure into substantive regulation. |

State of Enforcement

Much ink has been spilled already on Enforcement staff attrition and changes to the division's policies and priorities under the current administration. At the highest level, some have concluded (incorrectly, we would argue) that Enforcement has closed up shop but for the most egregious forms of fraud on retail investors. There can be no doubt this administration has been full-throated about its unwillingness to allow "regulation by enforcement" and instead focusing on a "back to basics" approach to policing the markets while offering a more fair and balanced approach to investigations. Several areas are clearly now in or out of focus:

| In Focus | Out of Focus (Gone But Not Forgotten?) |
| - focusing on bad actors, so-called "liars, cheats, and thieves"
- individual accountability – including gatekeeper liability for attorneys, accountants and others
- protecting retail investors and vulnerable populations from fraud and compensating victims of fraud
- public company misrepresentations and disclosure failures, offering frauds, fiduciary breaches, insider trading and other market manipulation, and accounting fraud
- asset manager and broker-dealer conduct, including with regard to fraud, misappropriation, failure to safeguard assets, conflicts of interest, fees and expenses, mismarking of assets, prohibited trading practices, unauthorized principal transactions, affiliated transactions, long-standing unmediated control breakdowns and violations | - so-called "regulation by enforcement," pointing to prior off-channel communications, crypto and select novel theories of enforcement
- focusing on the number of cases filed and instead prioritizing quality and impact of enforcement
- large corporate penalties that may punish shareholders where individuals should be held accountable
- non-fraud controls violations and compliance failures where thoughtful resolutions can be reached that appropriately recognize wrongdoing, as well as remediation and future compliance
- environmental, social and governance-related disclosure enforcement that does not relate directly to financial performance
- registration and other potential violations by digital asset companies where there is no fraud or investor harm
- aggressive cybersecurity enforcement that second-guesses an entity's incident disclosure practices |

Formation of a SOX Group

The SEC's Enforcement Division formed a new specialized unit – the "SOX Group" – dedicated to investigating and litigating violations of auditing and professional standards under the Sarbanes-Oxley Act of 2002 and other federal securities laws. On March 19, 2026, reports emerged that the SEC's Enforcement Division has posted federal job listings seeking a senior attorney and manager for the new SOX Group. An SEC spokesperson confirmed that the initiative is intended to "continue the Commission's longstanding efforts to crack down on bad actors in the profession," describing auditors as "critical gatekeepers" for ensuring the integrity of financial markets and helping prevent fraud. The formation of this group signals a meaningful shift in how the SEC intends to police the auditing profession, with significant implications for audit firms, public company audit committees and corporate officers responsible for financial reporting.

Wells Process Reform

The Enforcement Division is committed to providing a "transparent and fair" process to individuals and companies under investigation by standardizing the Wells process reflected in the recent Enforcement Manual updates. A member of senior leadership will now attend every Wells meeting, the submission window has been extended from two weeks to four, and every Wells submission will be read and "carefully considered." Wells recipients will be afforded the opportunity to engage in "open, informed, and thoughtful dialogue" with staff and zealously advocate the strengths and weaknesses of the case, while the division has considered a more fully developed record before recommending any enforcement action. Both staff and Wells recipients are expected to engage fairly and in good faith during the Wells process.

Focus on Promoting Crypto Business/New Interpretive Guidance

The SEC has engaged with crypto assets for more than a decade but historically relied on the Howey test to determine whether crypto assets qualify as securities, rather than developing a tailored regulatory framework. Prior to 2025, the Commission's approach was criticized as "regulating by enforcement," and issuers were required to comply with existing securities requirements indefinitely, regardless of whether the development team's promises had been fulfilled. In response, the SEC – joined by the CFTC – issued a new interpretation of the definition of "security" as applied to crypto assets, complementing congressional efforts to establish a comprehensive crypto market structure framework.

The interpretation states that digital commodities, collectibles and tools are not securities, full stop. Also, GENIUS Act-compliant and similar stablecoins are not securities, but digital securities are (of course) securities.

The interpretation addresses how a non-security crypto asset may become – and later cease to be – subject to an investment contract. A non-security crypto asset becomes subject to an investment contract when an issuer offers it by inducing an investment of money in a common enterprise with promises to undertake essential managerial efforts from which a purchaser would reasonably expect profits. The SEC also provided guidance on the nature and medium of the representations necessary to form such a contract. Importantly, the investment contract terminates when the issuer either fulfills or fails to satisfy its representations or promises.

The interpretation clarifies that protocol mining, protocol staking and the wrapping of a non-security crypto asset do not involve the offer and sale of a security. Additionally, certain crypto asset disseminations known as "airdrops" do not involve an "investment of money" under the Howey test and, therefore, fall outside the securities laws.

It remains to be seen how active the SEC will be with this renewed focus, how it will allocate reduced resources to those actions that amplify its investment protection mission, and what changes, if any, will come with the appointment of a new Director of Enforcement.

The SECond Opinions Blog will continue to monitor developments and provide updates.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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