UpFront » December 2024

Talk of drastic policy changes by the incoming SEC does not seem to include slowing enforcement cases against firms for making misleading statements about AI. Known as “AI washing,” the current SEC under Gary Gensler has been pursuing it as fraud through existing enforcement processes, and appearances are that these cases will continue under the Trump administration. According to Amy Lynch, FrontLine’s Founder and President, the cases stem from the same type of concerns that…

When an auditor abruptly resigned and then contacted the SEC about one of its clients, it may have set off a chain of events leading to an investigation. The tech company at risk, Super Micro, is tied to the AI boom. Following the withdrawal by its auditor, Ernst & Young (EY), it could now be the focus of an accounting-related fraud case. EY stated that it was no longer able to rely on Super Micro’s…

While an SEC risk alert issued last month on fund examination findings cites common deficiencies and compliance gaps, it also provides CCOs with key information on the exam process itself. FrontLine Compliance’s Founder and President Amy Lynch comments that the SEC alert lays out a game plan for exam preparation, which is especially helpful for new fund CCOs. She explains that newer CCOs may not have prior experiences with SEC exams since mutual fund complexes…

The exit of SEC Chairman Gary Gensler will usher in a new SEC administration that is likely to throttle down certain current priority areas. Speaking recently with Compliance Week, FrontLine Compliance Founder and President Amy Lynch discussed some of the major changes expected with the SEC’s approach under a Trump administration. She comments that the pace of SEC rulemaking should slow dramatically and expects the Trump administration to reinstitute their prior moratorium on new…