In re SEC Rule Imposing Speech Restraints in Consent Orders

The SEC Rule adopts “the policy that in any civil lawsuit brought by it or in any administrative proceeding of an accusatory nature pending before it, it is important to avoid creating, or permitting to be created, an impression that a decree is being entered or a sanction imposed, when the conduct did not, in fact, occur.” Accordingly, SEC will “not … permit a defendant or respondent to consent to a judgment or order that imposes a sanction while denying the allegations in the complaint or order for proceedings”—although at the same time the SEC
provides that the defendant or respondent may state “that he neither admits nor denies the allegations.” 17 C.F.R. § 202.5(e).

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