Attorneys as Gatekeepers: SEC Actions against Lawyers in the Age of Sarbanes-Oxley


Following the enactment of the Sarbanes-Oxley Act on July 30, 2002, the Securities and Exchange Commission has substantially increased the number of actions it has initiated against lawyers. And a substantial number of these recent SEC actions against counsel to public companies (both internal and external) have highlighted the SEC’s resolve to hold lawyers accountable for not performing adequately their SEC-conceived role as “gatekeepers” to prevent fraud and other violations of the federal securities laws. This “gatekeeper” concept has been and is being implemented through SEC actions addressing a wide variety of alleged transgressions in a wide diversity of factual settings. Moreover, the ushering in of what appears to be a new era of the SEC as active and enthusiastic proponent of the “gatekeeping” role of attorneys, raises serious questions. While academicians and practitioners have debated the consequences of this shift, a detailed examination of what the SEC is actually doing in fact has been lacking. This article seeks to focus on a compendium of real-life post-Sarbanes SEC enforcement actions, and to evaluate trends and consider conclusions. One of our most distinguished jurists has written “[t]he prophecies of what the courts will do in fact, and nothing more pretentious, are what I mean by the law.” Holmes, Path of the Law, 10 Harv. L. Rev. 457, 461 (1897). The enclosed article analyses what the SEC is “doing in fact” with respect to securities lawyers following the enactment of Sarbanes-Oxley.


Banking and Finance Law | Commercial Law | Legal Ethics and Professional Responsibility | Legal Profession | Securities Law

Date of this Version

February 2006