The U.S. Securities and Exchange Commission (SEC) has abolished a longstanding rule that prohibited companies and individuals from publicly denying allegations in settlements. Announced on May 18, the change allows parties to dispute SEC claims without admitting wrongdoing, impacting both new and historical cases. This marks a significant shift from the 1972 rule that restricted public denial of allegations.
The policy change is expected to affect cryptocurrency firms like Ripple, which have previously faced legal challenges with the SEC. The new rule permits these companies to publicly challenge the SEC's narrative post-settlement without breaching agreement terms. SEC Commissioner Hester Peirce supports the move, emphasizing that it enhances accountability and transparency by allowing public criticism of regulators.
SEC Revokes 50-Year Settlement Rule, Allowing Public Denial of Allegations
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