SEC LogoThe U.S. Securities and Exchange Commission (SEC) published (for public comment) a draft strategic plan, which sets forth its goals and objectives for fiscal years 2014 through 2018.  The SEC’s “strategic objectives” include: fostering compliance with federal securities laws; ramping-up efforts to “promptly detect and deter violations of federal securities laws”; and prosecuting violations of federal securities laws and holding violators accountable through “appropriate sanctions and remedies.”  Embracing the success its Office of the Whistleblower has achieved thus far, the draft plan capitalizes on the use of tips from whistleblowers.

To foster compliance with securities laws, the SEC plans to take a more proactive approach in communicating with chief compliance officers, senior executives and board members about compliance efforts.  To deter and detect securities violations, the SEC intends to:

  • enhance surveillance and risk assessment capabilities by gaining access to additional data;
  • improve the management of tips, complaints and referrals from whistleblowers;
  • encourage whistleblower complaints;
  • bolster the expertise of the SEC staff;
  • use a variety of tools— including cooperation agreements, deferred prosecution agreements and non-prosecution agreements—to encourage individuals and companies to promptly report violations and provide assistance to the agency; and
  • improve the sharing of information between divisions and offices of the Commission and with other regulators.

In addition, to meet its goal of holding violators of securities laws accountable, the SEC plans to:

  • utilize specialty groups within the enforcement program;
  • enhance timeliness of distributions to wronged investors;
  • enhance communications among SEC divisions and offices;
  • re-assess its approach to the use of penalties in connection with enforcement recommendations/actions so that penalties have the appropriate punitive and deterrent effect, having in mind avoiding unnecessary harm to shareholders; and
  • broaden the range of enforcement sanctions.

Employers should take heed by continuing to modernize and strengthen compliance programs and encouraging whistleblowers to lodge reports through designated channels so that investigations can be promptly and thoroughly conducted.

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Photo of Steven J. Pearlman Steven J. Pearlman

Steven J. Pearlman is a partner in the Labor & Employment Law Department, where he is Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group and Co-Head of the Whistleblowing & Retaliation Group.

Employment, Restrictive Covenant & Trade Secret, and Whistleblower…

Steven J. Pearlman is a partner in the Labor & Employment Law Department, where he is Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group and Co-Head of the Whistleblowing & Retaliation Group.

Employment, Restrictive Covenant & Trade Secret, and Whistleblower Practice. Steven’s national practice focuses on defending companies in federal and state courts and in arbitration fora against the full spectrum of employment-related claims, including claims of executives; restrictive covenant violations; employee raiding; theft of trade secrets; whistleblower retaliation under the Sarbanes-Oxley Act, the Dodd-Frank Act and similar state laws; and wage-and-hour violations, including class, collective and PAGA actions.

Steven has successfully handled trials in multiple jurisdictions; prevailed in seeking and defending against applications for temporary restraining orders and preliminary injunctions; defended one of the largest Illinois-only class actions in the history of the federal courts in Illinois (over 90k putative class members); and prevailed following his oral arguments before federal and state appellate courts. He brings his litigation experience (beginning in 1998) to bear in counseling clients to minimize risk and avoid or prepare for success in litigation.

Investigations. Reporting to boards of directors, their audit committees, CEOs and in-house counsel, Steven conducts sensitive investigations and has the unusual experience of testifying in federal court in connection with investigations. His investigations have involved complaints of sexual harassment involving C-suite officers; systemic violations of employment laws and company policies; and fraud, compliance failures and unethical conduct.

Thought Leadership and Accolades. Steven was named Lawyer of the Year for Chicago Labor & Employment Litigation in the 2023 edition of The Best Lawyers in America. He is a Fellow of the College of Labor and Employment Lawyers. Chambers has reported:

  • Steven is “one of the best in the country and has a lot of experience”;
  • Steven is as an “outstanding lawyer” who is “very sharp and very responsive,” a “strong advocate,” and an “expert in his field”;
  • He is thoughtful, attentive and demonstrates an acute understanding of matters top of mind for business-minded general counsel; and
  • “He is someone who can navigate the twists and turns of litigation without difficulty.”

Steven was 1 of 12 individuals selected by Compliance Week as a “Top Mind.” Earlier in his career, he was 1 of 5 U.S. lawyers selected by Law360 as a ”Rising Star Under 40” in the area of employment law and 1 of “40 Illinois Attorneys Under Forty to Watch” selected by Law Bulletin Publishing Company. Steven is a U.S. Library of Congress Burton Award Winner for “Distinguished Legal Writing.”

Steven was appointed to Law360’s Employment Editorial Advisory Board and selected as a Contributor to Forbes.com. He has appeared on Bloomberg News (television and radio) and Yahoo! Finance, and is often quoted in leading publications such as The Wall Street Journal. The U.S. Chamber of Commerce has engaged Steven to serve as lead counsel on amicus briefs to the U.S. Supreme Court and federal circuit courts of appeal.

In 2024, Steven received the Excellence in Pro Bono Service Award from the United States District Court for the Northern District of Illinois and the Chicago Chapter of the Federal Bar Association.

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