NEW YORK (TheStreet) -- Talk about killing the buzz.
Top regulators at the Securities and Exchange Commission were just catching their breath from a victory lap over their 2014 enforcement record when a federal appeals court in Manhattan delivered bad news.
A headline-grabbing criminal insider-trading conviction of two former hedge fund managers was overturned on Dec. 10, opening the possibility that the SEC's civil settlement in a parallel case might be withdrawn. At a New York Times/DealBook conference Dec. 11, SEC chair Mary Jo White conceded that the ruling was "a concern."
It was only in November that White and her top enforcement guy were crowing about the agency's record 755 cases in the fiscal year that ended Sept. 30.
The SEC is "firing on all cylinders," White said on stage at New York's Marriott Marquis at the Securities Industry and Financial Markets Association meeting, the annual confab of Wall Street's main lobbying group, last month. The agency's fiscal year was an enforcement division record "in the number and quality of cases," she said. Moreover, real live humans were getting charged -- not just faceless corporations -- including 52 insider-trading cases.
White's enforcement chief was pretty pleased, too. "I am proud of our excellent record of success and look forward to another year filled with high-impact enforcement actions," said Andrew J. Ceresney in a press release Oct. 16 announcing the record results -- including $4.16 billion in penalties and disgorgement. The SEC is holding wrongdoers accountable, he said.
But which wrongdoers are we talking about?
Cases Bypass Corner Offices
It's one thing to get a financial institution to hand over even hundreds of millions of dollars in a settlement that doesn't name names. But it's quite another to go after the C-suite executives.
Ceresney and I got talking on the telephone about the SEC's most recent enforcement actions, and he told me something surprising: "Seventy percent of our cases this past year involved individuals," he said.