SEC's Regulation FD Enforcement Actions Bring Compliance
Lessons to Light
You and your company might have forgotten about Regulation Fair
Disclosure (Regulation FD) but the Securities and Exchange
Commission (SEC) has not. Following a four year break in Regulation
FD enforcement actions, the SEC has revamped its efforts in the
area and is cracking down on selective disclosures. This could mean
stiff penalties for companies and executives who have forgotten the
old compliance lessons or failed to learn the new ones. The lessons
demonstrated by the SEC's recent enforcement actions might
surprise you.
When the SEC adopted Regulation FD in 2000 to prohibit selective
disclosures of material corporate information, it quickly came
under fire. Critics said the rule would have a chilling effect on
issuers' communications and, thus, would negatively impact
market efficiency. In an effort to assuage some of these fears, the
SEC stated that its enforcement actions would "not
