Effects of Trump’s Second Term on SEC’s Off-Channel Texting Investigation

The Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have been conducting a thorough investigation into Wall Street recordkeeping practices over the past three years. In light of this, Corporate Investigations & White Collar Defense partner David Oliwenstein shared his insights with Corporate Counsel on the future of off-channel communications scrutiny.

According to Oliwenstein, with the new leadership at the SEC under Trump’s appointees, the ongoing “sweep” of off-channel communications is expected to come to an end. While there may be some lingering cases in the pipeline that the SEC staff will work to finalize, the overall trend is towards wrapping up this initiative.

However, Oliwenstein emphasized that enforcement of rules will continue to be a priority. The Division of Examinations is likely to maintain its focus on off-channel communications during examinations, and the Enforcement Division will bring cases when serious and pervasive violations are detected. It is anticipated that penalties may decrease, and there may be less emphasis on mandating compliance consultants for regulated entities.

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Tags associated with this development include David Oliwenstein, Corporate Investigations & White Collar Defense, Litigation, Securities Litigation & Enforcement, and Regulatory in New York.