Good morning! Here’s what’s up.

At SEF Central in Chicago, Renato Mariotti of Paul Hastings put it simply: “Enforcement cases are down. But this area is a very, very notable exception.” He was talking about insider trading, and he noted that it is now very much a CFTC issue too, including on prediction markets.

We want to know what you think!

Securities Enforcement Forum D.C. is just days away, and we asked our speakers what they are watching. Here is a preview of what you will hear on Tuesday.

👉 What to expect in 2027

“I would be on the lookout for more public company financial reporting investigations and enforcement actions. The Enforcement Division created a new Financial Reporting and Accounting Unit, and it is led by Tim Zimmerman, whom I have known for many years and is a tenacious lawyer. The Division Director, David Woodcock, is a former accountant and has a particular interest in, and acute understanding of, the nuances of financial reporting.

We know the new unit is actively opening new investigations, reviewing whistleblower tips, and scanning publicly available information to identify new areas of inquiry. This is probably the number one regulatory risk public companies face for the foreseeable future.” — Mark Schonfeld, Gibson Dunn

“The first thing we’ll likely notice is the effect of [the new unit’s] fresh look at the existing investigation pipeline as they assess whether current open matters are meaningful and poised to result in high-impact cases. For those matters that don’t meet this bar, I expect they will be more promptly closed. For investigations that need further development, I expect they will be accelerated to quickly evaluate whether continued deployment of resources is warranted. I also expect they will be eager to apply creative techniques—e.g., harnessing data and AI capabilities—to identify and develop new inquiries, while applying well-balanced, practical judgment in determining whether continued resource commitments to existing matters are optimal.” — Jason Flemmons, Ankura

👉 What has changed day to day

“What hasn’t changed is how long investigations take: narrower priorities haven’t meant faster resolutions, and having worked to shorten timelines as Enforcement Director, just as my predecessors did, I know career staff have to satisfy themselves that they’ve followed the facts wherever they lead. From the defense side, I now see the cost of that time more clearly, not just financial but reputational and emotional, especially for individuals. The hardest cases are the ones where we’ve done the work and know ‘there’s no there there,’ yet no matter how cooperative the client, the process has to run its course.” — Gurbir Grewal, Milbank

“One thing I’ve noticed over the last year is an increased emphasis at the SEC on moving investigations forward efficiently and engaging in substantive discussions about potential resolutions earlier in the process. As a result, we’re spending more time looking proactively for opportunities to narrow issues, resolve matters where appropriate, and engage with the staff earlier about pragmatic paths toward resolution.” — Gerry Moody, Akin

👉 What companies should be doing now

“Reviewing and enhancing where appropriate disclosures and policies and procedures while the SEC enforcement program is in a ‘back to the basics’ cycle.” — Julie Riewe, Debevoise & Plimpton

“Companies should be stress-testing the connection between their disclosure controls and their compliance/investigative functions—particularly their ability to identify a potentially material problem, investigate it quickly, and get it to the people responsible for disclosure before the SEC learns about it from somewhere else. The SEC may be bringing fewer cases right now, but the cases it chooses to bring will be more focused, faster-moving and harder to explain away after the fact.” — Norman Harrison, Secretariat

👉 Hear more from all of them on Tuesday at the Mayflower. Register here!