The U.S. Securities and Exchange Commission is reviewing its practice of settling cases without requiring defendants to admit guilt, the agency’s chairman said today in congressional testimony.
SEC Chairman Mary Jo White, a former federal prosecutor, told a House Appropriations subcommittee that the policy has benefited investors while saving SEC resources. The settlements leave no question “about what the conduct was,” White said.
White’s comment provides an early window into whether she’ll change a practice that has been criticized by lawmakers, consumer groups and jurists including U.S. District Court Judge Jed Rakoff. The SEC has defended “no admit, no deny” settlements for the same reasons that White outlined.
“It is a very good end in many cases,” she told lawmakers. “It saves resources and you do not incur the litigation risk and you get lots of money to investors a lot quicker.”
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