The SEC imposed the highest total dollar amount of monetary penalties since 2021.
The U.S. Securities and Exchange Commission (SEC) drastically reduced its accounting and auditing enforcement activity in fiscal year 2024, the final year of Gary Gensler’s administration, ending two consecutive years of annual increases, according to a new report from Cornerstone Research. At the same time, monetary penalties reached their highest level since 2021.
The report, SEC Accounting and Auditing Enforcement Activity—Year in Review: FY 2024, found that the SEC initiated 45 accounting and auditing enforcement actions in FY 2024, a 46% decrease from FY 2023 and the lowest number since 2021. Approximately half of all actions (22) were initiated in the fourth quarter of the fiscal year, and more than one-third were initiated in September, the last month of the agency’s fiscal year.
The report also compares the Gensler period (FY 2021–FY 2024) to a comparable period under Jay Clayton (FY 2017–FY 2020), the SEC Chair during the first Trump administration. In contrast to other SEC priorities under Chair Gensler, such as cryptocurrency and off-channel communications, accounting and auditing enforcement activity generally declined. During the Gensler period, the SEC initiated an average of 60 enforcement actions per year, compared to 74 during the Clayton period. Settled actions declined under Chair Gensler, dropping nearly 20% to an average of 66 settled actions per year, compared to 80 under Chair Clayton.