April 9, 2026
On February 24, 2026, the US Securities and Exchange Commission (SEC) released updates to its Enforcement Manual (“Enforcement Manual”).[1] In doing so, the SEC reaffirmed its commitment to “fairness, transparency, and efficiency” and highlighted key changes from the previous draft published in 2017.[2]
In particular, the SEC’s additions outline best practices and set out the SEC’s framework for evaluating certain decisions in enforcement actions, including cooperation and penalty recommendations. These updates also highlight several areas where the role and contribution of experts can provide significant value in enforcement matters.
The SEC notes that the updates aim to improve the dialogue between the SEC and relevant parties with the goal of improving outcomes and enabling more timely investigation resolutions.[3] The Wells process is a key element of this important dialogue.
The recent updates explicitly encourage the incorporation of expert reports in Wells submissions to address “particularly complex or technical” charges during the pre-litigation phase.[4] This enables companies to use expert analysis to challenge the SEC staff’s preliminary findings, focusing on disputed technical, economic, or legal issues. Experts may also provide value by contributing to other written materials submitted to the SEC, such as white papers, addressing disputed matters.
The updates to the Enforcement Manual describe a revised framework for determining whether penalties should be reduced based on a company’s level of cooperation during SEC investigations.
Specifically, the Enforcement Manual explains that the SEC may “seek reduced civil penalties, against an entity in consideration of any self-policing, self-reporting, remediation, and cooperation by the entity.”
In evaluating whether companies will receive credit for self-policing or remediation actions, the Enforcement Manual now specifies that the SEC will consider the “independence, thoroughness, and effectiveness” of a company’s investigation as key criteria.[5]
The Enforcement Manual also identifies examples of effective remediation following an internal investigation, including strengthening internal controls and retaining independent compliance consultants to advise on remedial issues.[6]
In addition, the Enforcement Manual now provides expansive examples of cooperation, including “providing financial analyses conducted by external experts” to the SEC in a timely manner.[7]
The updated Enforcement Manual introduces “Top 5” priority matters (replacing “National Priority Matters”), which SEC Unit Chiefs will determine and update quarterly. The Enforcement Manual identifies several criteria Unit Chiefs will consider when making their priority determinations, including, for example, whether the matter:[8]
These criteria reiterate the emphasis the SEC is now placing on a “back to basics” approach that prioritizes protecting vulnerable investors, even amidst new and emerging market developments.
The updates to the Enforcement Manual specifically highlight areas where experts can add significant value to the investigative process conducted by registrants prior to self-reporting to the SEC. Secretariat professionals are closely monitoring the priorities identified by the SEC for 2026,[9] and the resulting enforcement actions.
Our experts are well positioned to assist companies and their counsel in navigating SEC inquiries and investigations. They are actively involved in domestic and international securities regulation and litigation dialogue. [10]
Further, our experts are trusted in high stakes matters that are considered high enforcement priorities by the SEC, includingcrypto, blockchain, and digital-asset investigations, as well as investment adviser regulation and enforcement.[11]
Reach out to the team to discuss the value we can bring to your securities enforcement-related matters.
[1] U.S. Securities and Exchange Commission – Division of Enforcement, Enforcement Manual, February 24, 2026 (https://www.sec.gov/divisions/enforce/enforcementmanual.pdf).
[2] Press Release, SEC’s Division of Enforcement Announces Updates to Enforcement Manual, February 24, 2026 (https://www.sec.gov/newsroom/press-releases/2026-20-secs-division-enforcement-announces-updates-enforcement-manual).
[3] Press Release, SEC’s Division of Enforcement Announces Updates to Enforcement Manual, February 24, 2026 (https://www.sec.gov/newsroom/press-releases/2026-20-secs-division-enforcement-announces-updates-enforcement-manual).
[4] Enforcement Manual, Section 6.1.2. Framework for Evaluating Cooperation and Related Efforts by Companies.
[5] Enforcement Manual, Section 3.1.4. Parallel Investigations and the State Actor Doctrine.
[6] Enforcement Manual, Section 6.1.2. Framework for Evaluating Cooperation and Related Efforts by Companies.
[7] Enforcement Manual, Section 6.1.2. Framework for Evaluating Cooperation and Related Efforts by Companies.
8] Enforcement Manual, Section 2.2.4 Ranking Investigations and Allocating Resources.
[9] U.S. Securities and Exchange Commission – Division of Examinations, Fiscal Year 2026 Examination Priorities, November 17, 2025 (https://www.sec.gov/files/2026-exam-priorities.pdf).
See also: https://secretariat-intl.com/insights/the-evolving-sec-enforcement-landscape-trends-for-2026/
See, also: https://secretariat-intl.com/insights/eric-poer-discusses-ai-and-enforcement-trends-shaping-securities-litigation-in-forbes/
[10] See, for example: https://secretariat-intl.com/insights/secretariat-expert-quoted-by-thomson-reuters-regulatory-intelligence/.
See, also: https://secretariat-intl.com/insights/trends-in-ai-related-securities-class-actions-through-2025/.
[11] See, for example: https://secretariat-intl.com/engagements/robert-mis-provided-pivotal-expert-findings-in-a-doj-landmark-577m-crypto-fraud-prosecution/.
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