SEC Enforcement Director Reflects on “Transitionary” Year for the Division and Reaffirms a “Back to Basics” Approach to Enforcement

On September 18, 2026, U.S. Securities and Exchange Commission (SEC or Agency) Enforcement Division (Division) Director David Woodcock gave public remarks reflecting on the Agency’s soon-to-be-ending fiscal year and provided key insights into the Division’s initiatives and priorities moving forward. Director Woodcock also provided specific guidance for parties and their counsel when responding to inquiries and investigations.

A Period of Transition for the Division

Woodcock, who became Enforcement Division Director in May 2026, remarked that fiscal year 2026 was a “transitionary” period, during which the Division “recalibrated [its] pipeline, launched critical initiatives, and re-established core principles.” In the months since his appointment, Woodcock said he met with staff in all 10 SEC regional offices and, during those meetings, affirmed that he is “aligned” with Chair Paul S. Atkin’s “back to basics” principles of enforcement. Those “back to basics” principles have meant redirecting resources to matters involving straightforward theories of harm to investors and market integrity (e.g., fraud, insider trading, accounting fraud, compliance failures, and investment adviser conflicts and misrepresentations).

Among those recalibration efforts, Woodcock said was “a comprehensive review of [the Division’s] investigative docket.” This review involved closing matters in the pipeline that current leadership determined were “out of step” with this Agency’s focus on “misconduct that causes genuine harm or otherwise presented little realistic prospect of delivering meaningful redress to investors.” Woodcock remarked that closing these matters freed up valuable Division resources, staff time, and attention, for pursuing matters more aligned with this Agency’s priorities. 

Priorities Moving Forward: Quality Over Quantity, Visibility, and Back to Basics

Director Woodcock also reiterated Chair Atkins’ calls to measure the success of the Agency and the Division not by the number of enforcement actions it brings, but by the quality of those actions. Woodcock said neither the number of enforcement actions filed nor the total size of monetary remedies obtained in cases, which have often been the focus of Agency insiders and outsiders alike, is the appropriate measure of success. He noted that those numbers for fiscal year 2026 would be particularly flawed because the enforcement program was impacted by the lengthy government shutdown, along with this period of recalibration and reorganization within the Agency.

Rather, Director Woodcock stressed the importance of the visibility of the quality enforcement matters the Division does choose to bring:

Rather than striving to bring an ever-increasing number of enforcement actions — without regard for their impact or their capacity to positively affect capital markets and investors — I am focused on administering an enforcement program that is strong and visible in the marketplace. […] The market must see — and feel — that Enforcement is on the job and market participants need to understand that if they violate the securities laws, they will suffer the consequences.

The objective is to put “bad actors” on notice that the Division is committed to identifying any misconduct and holding accountable those responsible, as well as installing prevention measures to inhibit further violations of the law.

Woodcock also highlighted recent enforcement matters from the last eight months to demonstrate the types of “back to basics” cases the Division would center its efforts on. Those matters include: 

• A “bread-and butter” offering fraud case involving an alleged multi-year Ponzi scheme
• Another retail investor fraud case involving purported crypto asset trading platforms and the use of artificial intelligence to fraudulently lure investors
• Fraud cases involving foreign bad actors and allegedly falsified SEC filings to lure retail investors
• Two litigated cases and three settlements involving fraud and misrepresentations in financial reporting, including (among other things) inflated and falsified revenue and other key performance indicators, books and records, and internal controls violations

Restructuring Within the Division and Interagency Coordination

In line with the broader recalibration of the Division toward certain priorities, Director Woodcock highlighted new initiatives including the newly launched Financial Reporting and Accounting Unit (which Goodwin previously discussed in detail in “SEC’s Enforcement Division Launches Specialized Unit for Financial Reporting and Accounting”) and the Retail Fraud Working Group, which will leverage data, technology, and intelligence-sharing to identify potential misconduct, and partner with regulatory counterparts and foreign partners. Woodcock also said the Division has a new Office of Artificial Intelligence & Analytics aimed at leveraging these emerging technologies in enforcement.

Woodcock spoke of the Agency’s efforts to coordinate with regulatory and law enforcement partners more broadly. He highlighted the SEC’s recently announced partnership with the U.S. Food and Drug Administration (FDA) to monitor FDA-related disclosures, along with other coordination efforts with the Commodity Futures Trading Commission, Public Company Accounting Oversight Board, and U.S. Attorneys’ Offices, including the Southern District of New York and the Northern District of Texas.

Guidance for Defense Bar

Director Woodcock closed his remarks with targeted messages to defense counsel. He offered four directions to counsel representing market participants facing SEC inquiries: 

1. Companies that self-report, cooperate, and remediate will be treated differently from companies that conceal, delay, or obstruct — “it’s better if you come to us first.”
2. Not all investigations follow the same path. Some involve voluminous document review before the taking of any testimony, while others may benefit from the taking of testimony before going down the full path of document productions — the taking of testimony at any point in an investigation “is not a negotiable concept” but a “procedural tool.”
3. Efficient cooperation to resolve investigations is expected — “responding quickly and clearly to inquiries, scheduling testimony promptly, avoiding serial extensions without cause, raising issues early rather than late, and engaging constructively in pre-enforcement dialogue.” Importantly, Director Woodcock said defense counsel who attempt to delay subpoena responses can expect the Division to file subpoena enforcement actions without delay. For example, in August 2026, the SEC filed a subpoena enforcement action in the Northern District of Texas against an LLC and various affiliated individuals and companies, and the Court granted the application within one day of filing, ordered these individuals to appear for testimony within 21 days, and required the production of documents within 30 days.
4. When requested, a meeting with the Deputy Director constitutes a meeting with the Front Office — meeting with them satisfies any request to elevate concerns and is consistent with the Division’s commitment to move matters forward efficiently. 

Takeaways

Director Woodcock’s remarks were not altogether surprising, as they are consistent with the priorities of Chair Atkins since he took over leadership of the Agency. Yet, the speech was a poignant affirmation of the direction and priorities of the Division moving forward and a signal to all market participants to prevent, and, if needed, disclose and remediate, the kind of conduct on which the Agency and Division are focusing. Director Woodcock has made clear the Division will not shy away from recommending that the SEC bring enforcement actions — often swiftly — once it identifies conduct that results in investor harm and/or undermines market integrity. Companies should have robust programs to monitor compliance and ensure accurate financial accounting and disclosures. Companies also should be prepared to keep pace with fast-moving investigations, including having the technology and systems in place to be able to cooperate swiftly with eDiscovery demands in response to subpoena requests for documents.

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Goodwin will continue to monitor developments in the SEC’s enforcement priorities and their potential impact on clients. Should you have any questions about the issues discussed in this alert, please contact us.