Enforcement action from the U.S. Securities and Exchange Commission (SEC) against public issuers dropped again in fiscal 2021, according to a new report from Cornerstone Research and the NYU Pollack Center for Law & Business.

The report indicated that in fiscal 2021 (to Sept. 30), the SEC filed 53 new enforcement actions against public companies, down 15% from the previous year and 45% lower than in 2019.

This represented the lowest number of enforcement actions against public companies in seven years, it said.

The drop in enforcement filings came amid the ongoing pandemic, and after a change in SEC leadership.

“We have seen declines in filing activity after a change of administration in the past,” said Sara Gilley, vice-president at Cornerstone Research, in a release.

“The decrease in actions from fiscal 2020 to fiscal 2021, when Gary Gensler took over as the SEC’s chair, is consistent with the trends seen in 2013 and 2017, other years in which a new SEC chair was sworn in,” she noted.

Despite the decline in the number of cases, the value of monetary settlements imposed by the SEC rose to US$1.8 billion in 2021, up from US$1.6 billion in 2020, which was consistent with the average for the 2012 to 2020 period.

The report also noted that the number of defendants that admitted guilt in public company actions dropped to zero in 2021, from two in 2020 and five in 2019.

“For the first time in 10 years, no public company or subsidiary defendants admitted guilt in fiscal 2021,” said Stephen Choi, professor at NYU and director of the Pollack Center.

“It will be interesting to see if this trend changes, as the SEC recently announced a policy to seek admissions in certain cases as a way to improve the deterrent value of enforcement actions,” he added.

Just over half of the enforcement action against public companies in 2021 involved disclosure allegations, the report said.

The SEC also filed its first-ever pandemic-related action and its first action against a SPAC during the year, it noted.