U.S. state securities regulators are increasingly taking enforcement action against unregistered offenders, according to a report published Wednesday from the North American Securities Administrators Association (NASAA).
NASAA’s 2018 Enforcement Report reveals that regulators took more enforcement action against unregistered individuals and firms in 2017.
U.S. state regulators bought 675 enforcement actions against unregistered firms and individuals in 2017, compared with 647 actions against registered individuals and firms.
Michael Pieciak, NASAA president, attributes the increase in enforcement against unregistered offenders, in part, to “an increased focus on fraudulent initial coin offerings (ICOs) and other cryptoassets,” NASAA says in a news release.
State securities regulators carried out almost 4,800 investigations in 2017, and took more than 2,100 enforcement actions, which resulted in more than US$486 million in restitution order and US$79 million in fines. (Canada’s provincial and territorial regulators report their enforcement stats separately.)
Of the actions involving registered firms and individuals, 377 enforcement actions targeted investment advisor firms and reps, and 270 actions were brought against broker-dealers and their reps.
“The results from this year’s enforcement survey demonstrate that state securities regulators continue to play a critical role in protecting investors and holding securities law violators responsible for the damage that they cause to individual investors specifically and to the integrity of our capital markets in general,” says Pieciak.