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SEC's Guilt Admission Policy May Bring Pricey Trials

July 23, 2013

By THOMAS A. ZACCARO, EDWARD HAN, & RACHANA N. FISCHER

This client alert discusses SEC Chairman Mary Jo White’s recent announcement that, in certain cases, the SEC would require defendants to admit guilt as part of any settlement or else face trial. This is a significant departure from the SEC’s previous policy of allowing defendants to enter into “neither admit nor deny” settlement agreements. This article traces the development of the SEC’s new policy and discusses the potential implications that could result from its implementation.