- SEC Chairman Paul Atkins was sworn in last week and will preside over a newly constituted SEC after a flood of departures due to DOGE. The rule-making agenda is likely to see significant shifts, experts said, but Atkins is no shrinking violet when it comes to enforcement actions.
Three out of the last four general counsels of the Securities & Exchange Commission are predicting that enforcement priorities will shift, but not disappear with newly sworn-in Chairman Paul Atkins at the helm of the agency.
Atkins took his post as chairman of the primary federal regulator of U.S. securities markets last week but he isn’t new to the SEC. Atkins previously served as a commissioner from 2002 to 2008 and he’s a noted crypto enthusiast, and previously held up to $6 million in crypto-related assets. Market watchers had predicted lighter-touch enforcement from the SEC, given President Trump’s focus on business-friendly policies, but make no mistake—enforcement isn’t going away under Atkins, predicted Melissa Hodgman, one of the SEC Division of Enforcement’s formerly longest serving senior officers.
According to Hodgman, Atkins’ remarks on enforcement have typically hit on a few key themes. Fraud, including accounting and disclosure fraud, and insider trading will likely be high-touch issues, she said, speaking last week at the Berkeley Spring Forum on M&A and the boardroom.
Hodgman is now a partner at law firm Freshfields but spent about 16 years in the SEC’s enforcement division. She warned the audience that lawyers should be attuned to the way executives and directors in possession of material non-public information are buying and selling securities, because regulators have become “extraordinarily good” at connecting the dots in insider trading cases through the use of social media and AI.
“They use data and analytics in a way that they didn’t get into in my career there,” said Hodgman. “This is an enforcement division that is going to be very focused in that area.”
On other enforcement cases, it’s likely the agency will see a shift in the rule violations brought before the commission, according to three former SEC general counsels, all of whom spoke on a panel together with Hodgman as moderator.
Robert Stebbins, general counsel of the SEC from 2017 to 2021 during Trump’s first presidency under Chairman Jay Clayton, predicted enforcement will go back to the priorities it had under Clayton’s tenure.
That would mean a focus on “Main Street” or retail individual investors, he said. Plus, there will be no Foreign Corrupt Practices Act enforcement this time around, Stebbins noted. The Trump administration paused FCPA enforcement in February, writing in an executive order that it hampered American economic competitiveness.
Dan Berkovitz, general counsel under former Chairman Gary Gensler from 2021 to to 2023, said with enforcement, there will be more focus on cases in which there has been investor harm rather than procedural violations.
Similarly, Megan Barbaro, general counsel from 2023 to 2025 aslo under Gensler, said it’s likely enforcement actions will seek lower corporate penalties because of a deeper concern at the commission that fines extracted from companies indirect harm shareholders.
“I expect to see smaller dollar amounts in those cases,” said Barbaro, who agreed with Berkovitz’s take on lower penalties. “There will be a focus on fraud, and fewer policies and procedures violations.”
In 2024, the SEC filed 583 enforcement actions and orders to collect more than $8 billion in fines. The number of cases was a decline of 26%, but $8.2 billion in fines was the highest amount in SEC history. Former chair Gensler was criticized by businesses for his broad rule-making agenda and even by fellow Commissioner Hester Peirce who called Gensler’s approach to crypto in certain cases “regulation-by-enforcement.”
In that vein, all three former chief lawyers said they expect the SEC under Atkins to address crypto regulation, even though it’s a “delicate” issue, said Stebbins.
On his fourth day as chair, Atkins spoke at the third roundtable of the SEC’s newly formed Crypto Task Force. Atkins gave a hat tip in his remarks to Peirce, who is nicknamed “CryptoMom.”
In the area of rule makings, the agency might also formally act on environmental disclosures, said Stebbins.
In March 2024, the SEC adopted final rules requiring new disclosures from public companies on direct and indirect greenhouse gas emissions. The rules faced immediate and swift legal backlash and following President Trump’s election in 2024, acting SEC Chairman Mark Uyeda announced the commission had voted to no longer defend the climate-risk disclosure rule in court.
In addition to crypto, Berkovitch said the regulatory landscape would likely focus on expanding access to private markets and raising the accredited investor threshold.
The SEC last addressed the threshold in 2020, expanding the definition of investors and firms that can invest in private equity, hedge funds, venture capital, and pre-IPO shares.
