Pictured Above: (Left to Right) Kevin Dill, GC and CCO at Tabula Rasa Healthcare; Stephanie Avakian, Co-Director, Division of Enforcement, SEC; Jeff Boujoukos LAW ’92, Regional Director of the SEC Philadelphia
On Tuesday, October 29, 2019, Temple Law’s Center for Compliance and Ethics held a roundtable event featuring Stephanie Avakian (LAW ’95), Co-Director of the SEC’s Division of Enforcement, and Jeffrey Boujoukos (LAW ’92), Director of the SEC’s Philadelphia Regional Office. Holland and Knight, a member of the Center’s Advisory Board, hosted the event at their Philadelphia Office. The event was part of the Center’s ongoing efforts to facilitate dialogue between the private and public sectors to advance effective, proactive, and sustainable approaches to compliance and ethics challenges. Temple Professors Harwell Wells, Jon Smollen, and Tom Lin moderated the discussion with Ms. Avakian and Mr. Boujoukos with more than twenty leading compliance officers, private practitioners, and in-house counsel participating in the discussion throughout the evening.
Although Ms. Avakian and Mr. Boujoukos clarified that their comments reflected only their individual views, the roundtable provided a unique opportunity to talk directly with SEC leaders. Technology was a major topic. Although cryptocurrencies continue to raise novel legal issues, roundtable participants agreed that, for the purposes of the U.S. securities laws, the critical inquiry is whether the crypto at issue is, in fact, a security. Technology was also emphasized during a discussion about the use of data analytics to identify and address risk areas. Roundtable participants acknowledged that a one-size-fits-all approach to the use of data analytics did not reflect reality for the wide range of regulated entities. The importance of forums like the SEC’s “Compliance Outreach Program” and Center roundtables for proactive dialogues about compliance and ethics challenges was also discussed along with the potential for dialogue outside of formal inspections to address compliance measures and provide regulatory guidance.
Despite the press that cryptocurrencies and cyberfraud often receive, Mr. Boujoukos noted that offering fraud and familiar-looking Ponzi schemes remain a high priority and concern. The SEC’s Philadelphia Regional Office continues to participate in educational forums for investors, particularly for at-risk populations like the elderly, to help prevent investor harm before fraudulently obtained funds evaporate forever.
Another topic of discussion was company efforts to receive cooperation credit in the context of SEC investigations. Ms. Avakian and Mr. Boujoukos noted the challenges in communicating through enforcement actions. To address this challenge, they noted that simultaneously announced resolutions may serve to highlight the nature and impact of cooperation. They stressed that cooperation went well beyond responding to subpoenas and ordinary investigative demands. In their view, a key component of a cooperation credit analysis involves assessing if agency resources were saved due to the investigation-target’s actions.
Roundtable participants expressed an interest in the SEC’s future policy goals and enforcement trends. Both Ms. Avakian and Mr. Boujoukos acknowledged that no one, not even the current SEC’s Commissioners, can predict the future. However, they encouraged roundtable attendees to take advantage of public information. The SEC’s Enforcement Manual and the Office of Compliance Inspections and Examinations’ Risk Alerts are excellent resources available to anyone looking to educate themselves about the SEC’s current work and possibly anticipate future trends.
In the end, the roundtable participants seemed pleased to have a forum for a constructive and open discussion without the company of a stenographer. Temple Law School’s Center for Compliance and Ethics will continue to facilitate these types of private-public sector dialogues as part of its mission to advance the understanding and practice of compliance and ethics across industries, sectors, and disciplines.
Joseph Crane (LAW ’20) is a J.D. Candidate in Temple Law School’s Class of 2020. He was a legal intern in the SEC’s Student Honors Program within the Division of Enforcement of the Philadelphia Regional Office.