TL;DR: The SEC filed 348 enforcement actions in fiscal 2026, the fewest since 1991. Former enforcement director John Reed Stark calls the report “bogus” and is urging SEC staff to blow the whistle on Chair Paul Atkins’ leadership.
Key Takeaways:
- SEC enforcement actions fall to the lowest level since 1991, with 348 actions in fiscal 2026, down from 456.
- Ex-SEC enforcement director John Reed Stark slams “bogus and absurd … propaganda.”
- Insiders urged to blow the whistle on SEC’s alleged dereliction of duty.
- Eight of 14 crypto cases the SEC dropped or softened involved parties with business ties to President Trump, according to The New York Times.
America’s securities regulator is hailing its reduced enforcement activity as a positive change, but a former enforcement director wants insiders to blow the whistle on the agency’s regulatory capture.
This week, the Securities and Exchange Commission (SEC) released its enforcement record for the fiscal year ending September 30, during which the agency rejigged its approach to “prioritize impactful enforcement actions and emphasize individual accountability to deter misconduct.”
In the real world, this meant a total of 348 actions in FY26, of which 235 were standalone actions, 47 were follow-on administrative proceedings (APs), and 66 were delinquent filings.
Those figures are significantly below FY25’s results, which saw a total of 456 actions: 303 standalone actions, 69 follow-on APs, and 84 delinquents. For the record, there were 431 standalone actions in FY24, which marked the final full year under former SEC chair Gary Gensler.
Gensler’s successor, Paul Atkins, has taken a decidedly more laissez-faire approach to regulation, particularly regarding digital asset operators. In releasing the FY25 numbers, Atkins claimed to have “recentered” the SEC’s enforcement mandate by “prioritizing cases that provide meaningful investor protection and strengthen market integrity.”
In the FY26 statement, Atkins said SEC enforcement “is ultimately measured by how effectively it advances the SEC’s mission, protects investors, holds wrongdoers accountable, and strengthens confidence in our markets. Enforcement actions and financial remedies are important measures of activity, but they are not the only or most telling measures.”
Nonetheless, Reuters reported that the FY26 enforcement tally represented “the fewest cases since 1991.” Sen. Elizabeth Warren (D-MA), who will likely chair the Senate Banking Committee when the new Congress is seated in January, said the Dems “will closely scrutinize whether the Atkins SEC is protecting the American people or working for scammers and [President] Trump’s billionaire buddies on Wall Street.”
The SEC issued $343 million in financial penalties in FY26, while ordering wrongdoers to disgorge another $752 million, for a total of just under $1.1 billion in money ordered. However, this falls to $860 million after ‘certain offsets’ (like parallel judgments in charges brought by other federal authorities) are applied.
A total of $731 million was distributed to ~250,000 harmed investors in FY26, a figure that compares quite favorably with the $262 million distributed to victims in FY25. That previous year’s total money ordered was significantly greater at nearly $18 billion, although that was goosed by nearly $15 billion from a single case involving the collapsed Stanford International Bank.
It’s worth noting that most of FY26’s delinquent filings were issued in bunches in the final weeks of the fiscal year. These filings were severely criticized by former SEC enforcement director John Reed Stark, a 20-year veteran who called the filings “stat padding.” Stark said this padding was meant to mask “the worst enforcement numbers in SEC history … a pathetically low level [of actions] with no modern precedent.”
Current enforcement director David Woodcock begs to differ, saying the FY26 results showed “an enforcement program that is more focused, effective, and prepared to address both longstanding and emerging threats to our markets.”
Stark previously criticized Woodcock for giving a speech that Stark called a “preemptive apology” for the SEC’s lack of enforcement rigor. Woodcock was elevated to his current position in April after the abrupt resignation the previous month by Margaret Ryan, who was reportedly frustrated with the SEC’s disinterest in examining Trump’s billion-dollar-plus crypto windfalls.
The SEC’s FY26 release also celebrates the formation of the Office of Super Intelligence and Analytics (‘super’ being Trump’s preferred terminology for what the rest of the world calls artificial intelligence/AI). The Office aims to “identify patterns of misconduct earlier, improve investigative efficiency, and detect emerging threats across markets,” including through “improved blockchain and financial‑flow analysis.”
The new fiscal year has already seen the SEC file charges against a crypto Ponzi scheme that raised $130 million from “tens of thousands of retail investors” between October 2025 and June 2026. The SEC accuses Colorado-based BG Wealth Sharing Ltd and DSJ Exchange Pty Ltd of making fraudulent claims of SEC registration and “extraordinary, risk-free returns” from nonexistent trading on DSJ’s platform. The SEC says the entities’ entire ‘wealth-sharing’ program was “a fiction.”
Is the SEC cooking its books?
On November 11, ex-SEC enforcer Stark issued a lengthy X post with the thoroughly restrained headline of “10 Reasons Why the SEC’s FY2026 Enforcement Report Is the Most Bogus and Absurd in SEC History.”
In August, the SEC announced the launch of its new Financial Reporting and Accounting Unit (FRAU), and Stark suggested that the first FRAU target should be “the SEC itself.” Stark called the FY26 report “propaganda above all else, an Orwellian Theater of the Absurd.” Stark twisted the knife further by claiming the SEC “built a unit to catch cooked books. Then it cooked its own.”
Among Stark’s top 10 complaints is Atkins’ SEC’s triumphant claim that it returned $731 million to harmed investors in FY26. Stark calls this “a real number and a welcome one,” while noting that “most of it has little to do with fiscal 2026.”
Stark explained that “money distributed in a given year is overwhelmingly money collected on judgments and settlements obtained in earlier years, by earlier Commissions, in cases that took three or four years to build. The release does not identify a single FY2026 action among the distributions, and I would be surprised if it could. The Atkins SEC is eating out of a pantry stocked by its predecessors and calling it a harvest.”
Stark concludes his jeremiad by saying the SEC’s “message to the crooks is ‘come one, come all.’” Stark believes enforcement reports “have one audience that matters more than Congress, more than the press and more than the defense bar. That audience is the next person deciding whether to steal.” The SEC “never deterred anyone by catching everyone. It deterred people because every October it published the proof that this year, it might be you.”
Stark says “no crook on earth” reads the SEC’s FY26 release “as a warning. Crooks read it as an invitation … the beat is unpatrolled, the cop is at a leadership seminar … the sign on the door says open.”
Come blow your whistle
Stark isn’t content to simply criticize, as this week also saw him urge current SEC staff to blow the whistle on perceived “corruption, misconduct or abuse involving Paul Atkins and his SEC leadership team.” In a 33-page, 18,000-word document, Stark detailed the legal protections available to whistleblowers who come forward with evidence of behind-the-scenes chicanery at federal agencies.
Stark laid out a lengthy list of the SEC’s perceived shortcomings, many involving crypto operators. Stark noted that “eight of the fourteen crypto matters [the SEC] dropped, paused or softened by December 2025 involved, by the New York Times’s count, parties with business ties to [President Trump] or his family.”
Stark called on SEC staffers to come forward with their knowledge of “what was said in those rooms: who gave the instruction, in what words, whether anyone objected and what happened to the people who did, whether anyone from outside the agency was on the phone, and whether there is an understanding, never written down, that a Trump-affiliated entity is not to appear in the agency’s own records as a related party, a witness or a subject.”
Tune in next week, when Stark challenges Atkins to square off in a no-holds-barred cage match. This time, it’s criminal.
FAQs:
Why are SEC enforcement actions down in 2026?
Chair Paul Atkins shifted the SEC’s focus to “impactful” cases. The agency filed 348 actions in fiscal 2026, the fewest since 1991, Reuters reported.
How many enforcement actions did the SEC file in FY26?
The SEC filed 348 actions, including 235 standalone cases, 47 follow-on administrative proceedings, and 66 delinquent filings. In fiscal 2025, it filed 456 actions.
How much money did the SEC recover in fiscal 2026?
The SEC ordered just under $1.1 billion in penalties and disgorgement. It returned $731 million to about 250,000 harmed investors.
Who is John Reed Stark?
Stark is a former SEC enforcement director and 20-year agency veteran. He called the fiscal 2026 report “propaganda” and accused the SEC of “stat padding.”
Why is Stark urging SEC staff to blow the whistle?
Stark wants staff to report alleged misconduct by Atkins’ team. He cites dropped crypto cases tied to President Trump and released a 33-page guide to whistleblower protections.
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Steven Stradbrooke
Steven Stradbrooke is a ‘self-taught’ writer who learned his craft from every book, newspaper, magazine, newsletter, snarky blog post and bathroom wall poem he ever read. Formerly the senior writer for 11 years at the CalvinAyre.com gambling industry news site, Steven wrote his first Bitcoin-focused article in 2011 and began contributing to CoinGeek in 2017. He joined CoinGeek full-time in 2021.
