Come on fellas, you gotta be kidding. Here’s the big change we’ve all been waiting for from the protector of the nation’s securities markets:
For those who plead guilty to fraud and other criminal offenses, the option of settling civil charges brought by the SEC will not be able to proceed with a mere “neither admit or deny liability” settlement. Nope, the new “get tough” sheriff in town (the SEC) says no more “denying liability.” Convicted criminals can instead remain silent and will not be forced to admit liability; that’s it.
For civil settlements: no change.
For a complete explanation of the SEC’s new policy see David Hilzenrath’s article in the Washington Post.
Okay, let’s see if I get this right. In 90% of cases (that is, civil cases)—no change. In the approximately 10% of criminal cases—a defendant need not admit civil liability. This is “less than meaningless” because to be convicted of a crime, prosecutors must establish guilt at a higher standard (beyond a reasonable doubt) where in a civil case the evidence must only be established by “a preponderance of evidence.” So if someone has already accepted (or been found guilty) beyond a reasonable doubt—what does it matter?—they have for all intents and purposes admitted civil liability (the lower standard).
Got it? I sure don’t. I respect the SEC. I know they have a cadre of hardworking, smart people. So what beyond window dressing is this latest effort? Surely Judge Rakoff, the provocateur in this effort will not be satisfied.