Double Teamed: Defending Parallel Investigations Under SECs New Cooperation InitiativePublished by the Washington Legal Foundation's Legal Backgrounder (April 2010)
By Laura L. Flippin and Morgan J. Miller
Accompanying a dramatic rise in the overall number of securities enforcement actions, the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ) are conducting parallel civil and criminal investigations at unprecedented levels. Through these parallel proceedings, the SEC and DOJ coordinate enforcement efforts concerning the same facts and conduct over which both agencies exercise jurisdiction. By imposing layers of intertwined policies, procedures, and regulations, parallel investigations can significantly increase the complexity of proceedings, particularly for corporations and their officers and directors who find themselves in the governments crosshairs. Recently announced measures by the SEC, touted to promote greater cooperation from individuals in SEC enforcement investigations, will likely raise the stakes for both corporations and individuals faced with parallel investigations.