Brooklyn Journal of Corporate, Financial & Commercial Law

First Page



The United States Securities and Exchange Commission (“SEC” or “Commission”) and its staff (“Staff”) have brought numerous actions against lawyers in a variety of contexts over the last several years. These enforcement actions have arguably prevented zealous advocacy as well as potentially leaving lawyers reluctant to make certain arguments on behalf of their clients so as to avoid potential disciplinary actions against them. While it is important for the Commission and its Staff to ensure that lawyers do not engage in violative conduct, this Article notes that the SEC and its Staff’s actions should be limited to only those occasions where the conduct is notorious and obvious. To avoid unwarranted interference in the right to counsel, this Article argues, at the very least, that the SEC should instead of bringing circumspect actions: (1) clarify the SEC’s approach to its use of Rule 102(e); (2) make mandatory referrals to state bar associations; and (3) create an independent board to review potential SEC actions against lawyers to ensure the good faith nature of the proposed action.