SEC to Push for Tougher Repeat-Violator Penalties

The Securities and Exchange Commission will press for tougher penalties against repeat violators of securities laws, SEC Chairman Harvey Pitt said Thursday.

“I am appalled at the number of repeat offenders we seem to confront at every commission meeting,” Pitt said in a speech to securities lawyers and corporate professionals in New York.

Pitt, who has headed the SEC for three months, said he plans to bring the “full scope of sanctions” to bear on repeat offenders, including pushing for criminal prosecutions. (The SEC’s cases involve civil law violations.)

To date, SEC commissioners “have not focused precisely on the fact that we’re dealing with recidivists,” Pitt said.

The SEC also will crack down on people who “lie or dissemble” in interviews with enforcement officials, and will refer these individuals for criminal prosecution, Pitt said. SEC officials didn’t immediately provide statistics on the number of repeat offenders.

With regard to corporate accounting, Pitt reiterated that the SEC’s main focus will be on improving financial disclosure rather than prosecuting corporate financial fraud.