Attorney Authored

Counterarguments to SEC Statistical Analysis in Enforcement Actions and Inquiries

February 13, 2017

Nicolas Morgan & Tiago Duarte-Silva

In recent years, the Securities and Exchange Commission has focused on using quantitative analysis to identify statistical outliers and anomalies through programs like the Aberrational Performance Inquiry, which evaluates hedge fund returns, and the Accounting Quality Model (informally known as “RoboCop”), which scours public company filings to estimate “peer-level risk metrics.” Using enforcement actions involving the allocation of securities as an example, we explore issues raised by the use of statistics in SEC enforcement actions and inquiries.

This article was originally published in The CLS Blue Sky Blog (Columbia Law School's Blog on Corporations and the Capital Markets)

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