{"id":5154,"date":"2011-03-29T00:00:00","date_gmt":"2011-03-29T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2011\/03\/sec_securities_settlements_oft"},"modified":"2022-04-14T14:34:58","modified_gmt":"2022-04-14T19:34:58","slug":"sec-securities-settlements-oft","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sec-securities-settlements-oft\/","title":{"rendered":"SEC Securities Settlements Often Don\u2019t Come with Admission of Wrongdoing"},"content":{"rendered":"

As Bloomberg News <\/em>columnist Ann Woolner points out, in most US Securities and Exchange Commission where a settlement is reached, the defendant usually ends up not having to admit to doing anything wrong. Instead, the securities fraud <\/a>agreement is accompanied by the boilerplate caveat that says that by settling, the plaintiff is doing so without \u201cwithout admitting or denying\u201d wrongdoing. <\/p>\n

Granted, there are certain cases where a conviction or guilty plea in a related criminal case makes it clear that a wrongful action did take place. One might also say that by agreeing to settle and pay a huge financial sum, the plaintiff is admitting to the wrongdoing without actually admitting to doing anything wrong. However, as Woolner points, not all defendants of US Securities and Exchange Commission cases are also charged in criminal court over the alleged securities fraud. Even when a settlement is reached, without an admission, the exact nature of the fraud is often left unclear. <\/p>\n

SEC spokesperson John Nestor says that of the over 600 securities lawsuits<\/a> filed every year, only about 20 of them ever go to trial. Nestor notes that the SEC\u2019s primary objective in any civil case is to secure the proper sanctions against wrongdoers and not making them admit wrongdoing is a way to get this done. Many violators will give up a great deal to avoid being held liable in civil court. They also have little incentive to confess because this could help the securities fraud lawsuits of plaintiffs. <\/p>\n

U.S. District Judge Jed Rakoff says that letting securities defendants get away with not admitting what they have done is a \u201cdisservice to the public.\u201d Meantime, SEC commissioner also says that he wants defendants to \u201ctake accountability\u201d and \u201cissue mea culpas.\u201d He also wants companies to stop putting out press releases suggesting that the SEC overreacted. <\/p>\n

Related Web Resources: <\/strong>
\nUncle Sam Wants Your Cash, Not Confession: Ann Woolner,<\/a> Bloomberg, March 24, 2011<\/p>\n

US Securities and Exchange Commission<\/a><\/p>\n

\nMore Blog Posts: <\/strong>
\nBank of America to Pay $137M Over Alleged Investment Scam To Pay Municipalities Low Interest Rates on Investments and $9M Over Alleged Bid-Rigging Scheme to Nonprofits<\/a>, Institutional Investors Securities Blog, December 16, 2010<\/p>\n

NJ Settles Municipal Bond Offering Fraud Charges with SEC<\/a>, Institutional Investors Securities Blog, September 30, 2010<\/p>\n

Federal Judge to Approve Citigroup\u2019s $75M Securities Settlement with SEC Over Bank\u2019s Subprime Mortgage Debt Reporting to Investors, Institutional Investors Securities Blog, September 29, 2010\n<\/p>\n

Continue Reading \u203a<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

As Bloomberg News columnist Ann Woolner points out, in most US Securities and Exchange Commission where a settlement is reached, the defendant usually ends up not having to admit to doing anything wrong. 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