2019 ENFORCEMENT PRIORITIES FOR THE FORT WORTH REGIONAL OFFICE

On February 25, 2019, Eric Werner and Marshall Gandy from the Fort Worth Regional Office of the Securities and Exchange Commission presented to the Dallas Bar Association’s Securities Section on the topic: “2019 Enforcement Priorities for the Fort Worth Regional Office.”

The presentation started and largely centered on the Regional Office’s ability to “do more with less.” Mr. Werner told the audience that in 2018 the Regional Office employed 30 enforcement agents, but currently only employs 20. He remarked that fewer agents will necessarily result in fewer enforcement actions, though the downturn would “not be significant.” Still, Mr. Werner assured the audience that they would not see any notable change in the type of actions pursued by the Commission. And, if any change were observed, it would simply be a function of the type of cases ripe for prosecution, not a realignment of priorities. Perhaps most striking, Mr. Werner suggested resources would need to be reallocated to relitigate cases effected by the Supreme Court’s Lucia decision. His comment hinted at the Commission’s interpretation of the Supreme Court’s stance on relief for respondents with non-pending cases that were previously decided by the Commission’s Administrative Law Judges.

Mr. Gandy commented on the Commission’s examination processes, paying particular attention to the Commission’s desire to engage registrants and empower them to self-police. He told the audience the Office of Compliance Inspections and Examinations does not measure success by how many cases are referred to the Division of Enforcement. He sought to dispel the idea that “if you call [OCIE], you will be examined,” stating, “nothing could be further from the truth.” Mr. Gandy also commented on registrants’ compliance programs and the OCIE’s willingness to help prepare adequate programs.

Both Messrs. Werner and Gandy emphasized the Commission’s focus on Main Street, individual accountability, and the proper allocation of resources. Their tone was cooperative.