SEC Should Improve Disgorgement Oversight, GAO Says

Law360, New York (April 5, 2013, 3:34 PM EDT) -- The U.S. Securities and Exchange Commission needs to improve oversight of disgorgement and penalties won in agency enforcement actions to avoid exposing those funds to fraud and error and hindering distribution to harmed investors, the U.S. Government Accountability Office said Friday.

A GAO audit identified deficiencies in procedures for recording and reviewing disgorgement and penalty transactions, finding that the agency deficiently monitored disbursements. The audit said the deficiencies did not constitute a "material weakness" but still warranted management attention.

"SEC did not require that reviews be...
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