In a recent Law360 article, Baker McKenzie partner Peter Chan examines how the US Securities and Exchange Commission can better define and measure the effectiveness of its enforcement program following the appointment of Enforcement Director David Woodstock. He explains that traditional metrics, such as case volume and monetary penalties, may not accurately reflect the agency’s impact and can incentivize a focus on headline figures over meaningful investor protection.

Peter proposes a new enforcement “scorecard” focused on how effectively the SEC detects and stops intentional fraud at an early stage, emphasizing that such misconduct poses the greatest risk to investors and markets. He outlines alternative metrics, including the speed of fraud detection, the timing of enforcement actions, and litigation outcomes, and concludes that adopting this approach would better align enforcement priorities with the SEC’s core mission of protecting the investing public.

Read the full article here.