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In Sztrom v. SEC, the U.S. District Court for the District of Columbia confirmed that the U.S. Supreme Court’s 2024 decision in SEC v. Jarkesy, which curtailed the Securities and Exchange Commission’s (SEC) ability to seek civil penalties in its administrative forum, does not eliminate the agency’s long-standing ability to pursue industry bars through administrative follow-on proceedings. The opinion underscores that, even after Jarkesy and other recent limits on agency power, the SEC may still use its in-house process to determine whether to bar previously enjoined defendants from the securities industry, with independent review limited to the courts of appeals.

Last May, we provided a client alert about a recent federal district court case (Spence v. American Airlines, No. 4:23-cv-00552-O, 2025 WL 225127, at *2 (N.D. Tex. Jan. 10, 2025)), in which a plan sponsor and certain plan fiduciaries were found to have breached their ERISA fiduciary duty of loyalty based primarily on conduct related to proxy voting of securities held in certain of the 401(k) plans’ investment funds. At that time, the court left open the question of whether the breach resulted in any damages to the participants.

Troutman Pepper Locke’s Securities Investigations + Enforcement Practice

Troutman Pepper Locke’s Securities Investigations and Enforcement team counsels and defends clients through all stages of securities enforcement proceedings. Our attorneys have served in key government agencies and regulatory bodies, and bring their insight to bear in each representation. The team includes a former branch chief of…

On September 26, Securities and Exchange Commission (SEC) Chair Paul S. Atkins announced a return to the SEC’s prior practice of allowing individuals and entities facing enforcement actions to request that the SEC simultaneously consider both their settlement offers and any related waiver requests. Waivers may be necessary to avoid automatic disqualifications and collateral consequences that can result from enforcement actions, such as the loss of well-known seasoned issuer status, safe harbor protections, private offering exemptions, or the ability to serve in certain regulated capacities.

Troutman Pepper Locke is pleased to announce that four of its financial services attorneys were recognized under the special designation of “Lawyer of the Year” in the 2026 edition of The Best Lawyers in America®, an honor earned by just one lawyer in each practice area and metropolitan area.

Troutman Pepper Locke’s Securities Investigations + Enforcement Practice

Our Securities Investigations + Enforcement practice has expanded significantly due to our recent merger, enhancing our capabilities nationwide, including in our San Francisco, Dallas, and New York offices. We counsel and defend clients throughout all stages of securities enforcement proceedings, representing a diverse range of clients, including major financial institutions, senior corporate executives, boards of directors, and various entities in the financial services industry. Our team handles investigations by regulatory bodies such as the SEC, FINRA, and the Department of Justice. Leveraging decades of experience and including former key government officials, we develop informed and effective strategies tailored to each client’s unique needs. To read more about our capabilities, please click here.

Following the Freedom of Information Act (FOIA) litigation brought against the Federal Deposit Insurance Corporation (FDIC) in 2024,[1] on February 5, 2025, the FDIC released hundreds of pages of documents related to its supervision of banks that engaged in, or sought to engage in, crypto-related activities during the last administration. Acting Chairman Hill’s decision to release these documents reflected “a commitment to enhance transparency, beyond what is required by the [FOIA], while also attempting to fulfill the spirit of the FOIA request.”[2]

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Troutman Pepper Locke’s Securities Investigations + Enforcement Practice

Our Securities Investigations + Enforcement practice has expanded significantly due to our recent merger, enhancing our capabilities nationwide, including in our San Francisco, Dallas, and New York offices. We counsel and defend clients throughout all stages of securities enforcement proceedings, representing a diverse range of clients, including major financial institutions, senior corporate executives, boards of directors, and various entities in the financial services industry. Our team handles investigations by regulatory bodies such as the SEC, FINRA, and the Department of Justice. Leveraging decades of experience and including former key government officials, we develop informed and effective strategies tailored to each client’s unique needs. To read more about our capabilities, please click here.

We find ourselves in the midst of a raucous debate among sanctions practitioners about the impact of the Fifth Circuit’s recent decision upholding a challenge against the sanctions the Office of Foreign Assets Control (OFAC) imposed on Tornado Cash, a cryptocurrency “mixer.” Does this case presage a sea change in how OFAC’s sanctions will apply to new technologies that may not clearly fall within the bounds of the agency’s 1970s-era statutory authority? Or is the Fifth Circuit’s ruling likely to be overturned, merely a statement of the obvious, so unclear as to have minimal real world impacts, or otherwise just a blip in the decades-long trend of judicial deference to OFAC?

On September 4, the Securities and Exchange Commission (SEC) issued an order against three investment adviser firms for violating the whistleblower protections of Rule 21F-17(a) under the Securities Exchange Act of 1934. This rule prohibits any person from taking action to impede an individual from communicating directly with the SEC about possible securities law violations, including enforcing or threatening to enforce a confidentiality agreement with respect to such communications.