ANTICORRUPTION DEVELOPMENTS
Acting SEC Chief Limits Subpoena Authority to Enforcement Division Acting Director
On February 15, 2017, The Wall Street Journal reported that the acting Chair of the Securities and Exchange Commission (SEC), Michael Piwowar, revoked subpoena authority from about 20 senior enforcement officials and limited such authority to Stephanie Avakian, the acting Director of the SEC's Division of Enforcement. Since 2009, senior enforcement attorneys have had the authority to issue such subpoenas without review by the Director. The SEC did not announce the decision, but the Journal confirmed the change with "[t]wo people familiar with the matter."
The SEC's Division of Enforcement conducts investigations into possible violations of the federal securities laws, and litigates the SEC's civil enforcement proceedings in the federal courts and in administrative proceedings.
For more information, see The Wall Street Journal's coverage here.
Congress Approves Resolution to Rescind SEC's Resource Extraction Payments Disclosure Rule
On February 14, 2017, President Donald J. Trump signed into law a Joint Resolution under the Congressional Review Act (CRA) disapproving of the SEC's Final Rule, titled "Disclosure of Payments by Resource Extraction Issuers."
The SEC adopted the rule requiring disclosure of resource extraction payments on June 27, 2016, after it had been originally promulgated in 2012 and subsequently vacated by the U.S. District Court for the District of Columbia in 2013. The rule requires that certain producers of oil, natural gas and minerals publicly disclose information regarding payments to the U.S. federal government, as well as to foreign governments, to further the commercial development of such resources. The SEC was required to issue the rule under Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Under the CRA, 5 U.S.C. § 8, Congress has 60 days from the beginning of the 115th Congress to initiate a congressional review of any of the regulations promulgated by the Obama administration after May 2016. If the final rule is repealed under the CRA procedure, it is not only immediately nullified, but it restricts all future administrations from promulgating rules on the same subject matter. Since the law was enacted in 1996, it has been used only once to nullify a rule promulgated by the Clinton administration related to ergonomics when Senate Republicans initiated the resolution of disapproval, and it was signed by President George W. Bush.
For more information see our prior coverage here and The Wall Street Journal's coverage here and here.
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