The Securities and Exchange Commission (“SEC”) recently announced three new enforcement initiatives in its ongoing fight against fraud:
- “The Financial Reporting and Audit Task Force dedicated to detecting fraudulent or improper financial reporting, whose work will enhance the Division’s ongoing enforcement efforts related to accounting and disclosure fraud.
- The Microcap Fraud Task Force targeting abusive trading and fraudulent conduct in securities issued by microcap companies, especially those that do not regularly publicly report their financial results.
- The Center for Risk and Quantitative Analytics employing quantitative data and analysis to profile high-risk behaviors and transactions and support initiatives to detect misconduct, increasing the Division’s ability to investigate and prevent conduct that harms investors”
The new initiatives demonstrate the SEC’s efforts toward combating fraud using a variety of approaches, from the “grass roots” man hours of staff in the field to data analytics using cutting edge technology.