SEC grabs attention of activist firms with recent settlement (InvestmentNews)

The SEC has been interested in pursuing charges against activist investor Carl Icahn and his firm for many years, according to Amy Lynch, FrontLine’s Founder and President. The SEC has now finally settled a case with Icahn and his company, IEP, for $2 million in fines. With quotes in the title, subtitle and within the InvestmentNews story, Ms. Lynch explains that the SEC took advantage of technical violations for an opportunity to pursue a case against Icahn. The SEC focused on certain disclosure violations that the regulator said deprived prospective and existing investors of required information about IEP’s use of shares as collateral for loans and that it had margin loan agreements for a number of years. The bigger picture for the SEC, comments Ms. Lynch, is to send a message to activist firms that their reputation may be on the line if they are caught committing regulatory infractions. She further notes that the lesson learned is to ensure your SEC reporting is accurate and timely to avoid similar charges. See InvestmentNews, “SEC ‘took advantage of what they could’ in case against Icahn”