APPENDIX 12. SEC policy statement concerning cooperation by individuals in its investigations and related enforcement actions

AuthorRobert W. Tarun
Pages623-626
APPENDIX 12
SEC Policy Statement Concerning
Cooperation by Individuals in
Its Investigations and Related
Enforcement Actions
17 C.F.R. § 200.12 (2010)
Ti tle 17: Commodity and Securities Exchanges
Part 202 – Informal and Other Procedures
202.12 Policy statement concerning cooperation by individuals in its investiga-
tions and related enforcement actions.
Cooperation by individuals and entities in the Commission’s investigations and
related enforcement actions can contribute significantly to the success of the
agency’s mission. Cooperation can enhance the Commission’s ability to detect vio-
lations of the federal securities laws, increase the effectiveness and efficiency of
the Commission’s investigations, and provide important evidence for the Com-
mission’s enforcement actions. There is a wide spectrum of tools available to the
Commission and its staff for facilitating and rewarding cooperation by individu-
als, ranging from taking no enforcement action to pursuing reduced charges and
sanctions in connection with enforcement actions. As with any cooperation pro-
gram, there exists some tension between the objectives of holding individuals fully
accountable for their misconduct and providing incentives for individuals to coop-
erate with law enforcement authorities. This policy statement sets forth the ana-
lytical framework employed by the Commission and its staff for resolving this ten
sion in a manner that ensures that potential cooperation arrangements maxi-
mize the Commission’s law enforcement interests. Although the evaluation of
cooperation requires a case-by-case analysis of the specific circumstances pre-
sented, as described in greater detail below, the Commission’s general approach
is to determine whether, how much, and in what manner to credit cooperation
by individuals by evaluating four considerations: the assistance provided by the
cooperating individual in the Commission’s investigation or related enforcement
actions (“Investigation”); the importance of the underlying matter in which the
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