On December 17, 2021, the SEC announced a $125 million settlement with JPMorgan Chase & Co., disposing of allegations that the bank failed to properly monitor and retain its employees’ work-related communications. Pursuant to the settlement, JPMorgan admitted to the charges—the first admission of guilt to the agency since October, when new SEC Enforcement Director Gurbir Grewal announced that the agency would emphasize such admissions going forward.
Historically, the SEC has been understandably content with “neither admit nor deny” settlements. Fines and injunctions can be obtained even if the company never admits the charges, so the agency often has little incentive to pursue admissions aggressively. On the other hand, the companies under investigation are far more motivated to avoid an acknowledgment of guilt. Admissions to the SEC can sometimes be used by private securities litigation attorneys to provide the factual support necessary to get past the pleadings stage and into discovery. And there can be regulatory and tax consequences as well. Because the acknowledgment of guilt is more valuable to the company than the SEC, it can be used as a bargaining chip—perhaps in exchange for a bigger fine.
Critics of this practice have long argued that the consequences of an SEC settlement go beyond the purely legal—there’s an element of public accountability. For example, Judge Jed Rakoff famously excoriated a proposed consent order between the SEC and Citigroup, writing that such arrangements did not serve the public interest and refusing to approve the order. The Second Circuit reversed, and Judge Rakoff was forced to approve the settlement—although he reiterated his concerns in doing so.
The SEC apparently took note of Judge Rakoff’s concerns. Before the Second Circuit’s reversal, then-Chair of the SEC, Mary Jo White, announced a change to the forty-year-old policy: the SEC would require admissions of guilt going forward, at least in certain kinds of cases. But as it turned out, the policy change made little difference. A study of SEC enforcement actions from the announcement of the policy to February 2017 showed that admissions were only obtained in a very small percentage of cases—between one and three percent, depending on the metrics used.
It’s far too soon to tell whether a meaningful increase in admissions is forthcoming—as noted above, the JPMorgan settlement is the first to require an acknowledgement of misconduct since Grewal’s statement in October. But along with Grewal, the new Chair of the SEC, Gary Gensler, has been open about his desire to lead a more aggressive agency. The JPMorgan settlement might be the first of many.
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 Thomas Franck & Hugh Son, JPMorgan hit with $200 million in fines for letting employees use WhatsApp to evade regulators’ reach, CNBC (Dec. 17, 2021, 8:30 AM), https://www.cnbc.com/2021/12/17/jpmorgan-agrees-to-125-million-fine-for-letting-employees-use-whatsapp-to-evade-regulators.html. JPMorgan paid an additional $75 million to resolve similar charges from the CFTC.
 In re OSG Sec. Litig., 12 F. Supp. 3d 619, 621–22 (S.D.N.Y. 2014).
 S.E.C. v. Citigroup Glob. Mkts., Inc., 827 F. Supp. 2d 328, 333 (S.D.N.Y. 2011), vacated and remanded, 752 F.3d 285 (2d Cir. 2014).
 S.E.C. v. Citigroup Glob. Mkts., Inc., 34 F. Supp. 3d 379, 380 (S.D.N.Y. 2014) (“[T]his Court fears that, as a result of the Court of Appeal’s decision, the settlements reached by governmental regulatory bodies and enforced by the judiciary’s contempt powers will in practice be subject to no meaningful oversight whatsoever.”).
 She also laid out four rough categories of cases that might require such an admission.
 See David Rosenfeld, Admissions in SEC Enforcement Cases: The Revolution That Wasn’t, 103 Iowa L. Rev. 113, 129–38 (2017); see also Verity Winship & Jennifer K. Robbennolt, An Empirical Study of Admissions in SEC Settlements, 60 Ariz. L. Rev. 1 (2018).