Minus self-reporting, firms feel the heat from SEC on share class sweep; Amy Lynch discusses (IGNITES – Subscription Req’d)

Amy Lynch, Founder and President - FrontLine Compliance
Amy Lynch, Founder and President – FrontLine Compliance

With the SEC’s share class sweep now in its later stages, a number of firms are under pressure by the regulator to settle cases. Amy Lynch, FrontLine’s Founder and President, explains that these firms are primarily small and mid-sized shops that feel boxed in to negotiate with the SEC because they lack the deep pockets of larger firms. Many of these firms struggled to recover the historical data requested by the SEC to self-report violations. Ms. Lynch views the tactic of first offering amnesty for voluntarily reporting, then leveraging the lack of reporting to secure settlements, as a mechanism to be more commonly relied on by regulators to curtail industry-wide abuses. See IGNITES (subscription required), “Under Pressure: SEC Pushing Firms to Settle Share-Class Cases”