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15 November 2024
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SEC enforcement targets beneficial ownership reporting violations
SEC Update
13 November 2024
On September 25, the SEC announced that it had initiated and simultaneously settled cease-and-desist proceedings against 23 individuals and companies charged with violations of Exchange Act provisions and SEC rules that required them to report information about their holdings and transactions in public company equity securities.
Most of the alleged violations involved failures to file beneficial ownership reports in a timely manner. The SEC cited the respondents for filing late reports on Forms 3, 4, and 5 under Exchange Act Section 16(a) and Schedule 13D or 13G disclosure statements under Exchange Act Section 13(d) or 13(g). In addition, the SEC charged one company for also filing late reports of its reportable securities holdings on Form 13F as required by Exchange Act Section 13(f).
The SEC cited two other public companies with causing violations of Section 16(a) by their officers and directors by agreeing to assist them in preparing and filing their reports on time but failing to do so. Those companies were further charged with violating Exchange Act Section 13(a) by failing to report their insiders’ delinquent Section 16(a) filings as required by Item 405 of the SEC’s Regulation S-K.
In settling the actions, the respondents agreed to pay civil monetary penalties and to enter into orders requiring them to cease and desist from committing or causing future violations of the reporting requirements.
Authored by Alan Dye (co-editor), Richard Parrino (co-editor), Rupa Briggs, Kevin Greenslade, Ann Kim, Weston Gaines, and Gibby Wagner.
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13 November 2024
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