On November 18, 2021, the SEC announced enforcement results stemming from its 2021 fiscal year which ended on September 30, 2021. The SEC reported 434 new enforcement actions filed in 2021, representing a 7 percent increase over the prior year, and involving new or developing areas of the securities industry, such as crypto, SPACs and Form CRS compliance. 

With respect to enforcement matters involving investment advisers, the SEC highlighted several actions in “key priority areas,” including the following:

• The SEC charged an adviser for inadequate disclosures and other misstatements and omissions concerning its transfer of top traders to another fund resulting in a $170 million return to harmed investors.

• The SEC charged two advisers and their portfolio managers with misleading investors about risk management practices regarding a mutual fund and several private funds that lost more than $1 billion in two trading days.

• The SEC charged an adviser with fraudulently raising and misappropriating tens of millions of dollars in a private fund.

• The SEC charged a robo-adviser with breaching its fiduciary duties in connection with investments into exchange-traded funds sponsored by an affiliate.

• The SEC charged an adviser for breaching its fiduciary duties in connection with its receipt of revenue sharing payments.

Overall, the SEC obtained judgments and orders for nearly $2.4 billion in disgorgement and more than $1.4 billion in penalties, representing a 33 percent decrease and 33 percent increase, respectively, over amounts ordered in the prior fiscal year. The SEC also reported awards totaling $564 million to 108 whistleblowers—establishing fiscal year 2021 as a record year for whistleblower awards—and noted that its whistleblower program surpassed $1 billion in awards over the life of the program.

The SEC’s announcement is available here.