One Surprising Winner Under Dodd-Frank: The SEC’s Enforcement Division

Introduction

The recent financial crisis has led to much regulatory ferment, along with public outrage at the apparent lapses of market oversight by the U.S. Securities and Exchange Commission (SEC or the Commission). One outgrowth of this phenomenon is the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which (in part) required the SEC to hire an independent consultant to assess its internal operations, structure, funding, and relationship with Self-Regulating Organizations (SROs) in an effort to identify "improvements" to the Commission.¹ The assessment was conducted by the Boston Consulting Group, which spent six months reviewing documents, analyzing data, and interviewing hundreds of current and former SEC officials, regulated entities, peer regulators, SROs, and industry groups. The result is a 263-page BCG Report (Report), published on March 10, 2011, and setting forth 16 specific recommendations in four categories.²