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ARTICLE · 21 MAY 2026

SEC Rescinds “No-Deny” Settlement Policy

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The Securities and Exchange Commission has eliminated a decades-old settlement requirement that prevented defendants from publicly denying allegations. This policy shift, affecting enforcement actions dating back to 1972, fundamentally changes how parties can communicate about settled cases and may reshape settlement negotiations going forward.

United StatesGovernment, Public Sector
Emily Gauthier
Emily Gauthier

On May 18, 2026, the SEC rescinded its long-standing policy that generally conditioned settlement of enforcement actions on a defendant or respondent’s agreement not to publicly deny the SEC’s allegations. The policy, codified in Rule 202.5(e) of the SEC's rules of informal procedure, had been in place since 1972, although most other federal agencies, including the DOJ, have not adopted comparable no-deny policies.

The practical effect is straightforward. The SEC may now settle enforcement actions without requiring a settling party to refrain from publicly denying the SEC's allegations or suggesting the allegations lack a factual basis. The SEC also stated that it will not enforce existing no-deny provisions in prior settlements or seek to reopen settled cases based on a breach of those provisions.

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