SEC launches new online tool to help investors avoid fraud

On behalf of Law Office of Clifford J. Hunt, P.A. posted in regulatory compliance on Friday, June 8, 2018.

When an investor is approached about buying securities, he or she does not always know what they need to about the person or entity who is trying to make the sale. This can be particularly troubling if an individual has failed to toe the line with respect to regulatory compliance or did something else to make them the subject of an enforcement action. Fortunately, the Securities and Exchange Commission (SEC) is about to make it easier for potential investors to perform due diligence.

Earlier this month the SEC announced the launch of the SEC Action Lookup for Individuals (SALI) tool. With SALI, a potential investor can search for an individual using his or her first and last name. The results will show individuals – both registered and unregistered – who are named parties to enforcement actions and who have had federal court judgments or SEC orders filed against them.

The contents will also include individuals against whom a default entry was made, as well as those who contested or settled their actions, as long as an adverse judgment or order was entered in the matter. As of the launch, SALI could only look up enforcement actions that were filed between October 1, 2014 and March 31, 2018. However, the SEC has plans to update the tool periodically to include both older and more recent enforcement actions.

At this time, SALI will only return results in which an adverse result has been entered. The results will not include matters that are currently pending, nor will they include cases in which no judgment or SEC order was entered. The purpose behind SALI is to help investors make informed decisions and to help avoid financial fraud.