SEC’s Revisions to its Enforcement Manual – February 2026

By Mark J. Astarita, Esq.

The Securities and Exchange Commission has announced what it labels “comprehensive revisions” to its Enforcement Manual, marking the first update since 2017. The SEC claims that the changes are designed to strengthen fairness, transparency, and procedural consistency in enforcement investigations, while improving efficiency and resource management. Key revisions address the Wells process, settlement and waiver procedures, cooperation standards, and internal enforcement practices. The updated manual will now be subject to annual review to ensure it remains current and aligned with the Commission’s investor protection mission.

Updates to the Enforcement Manual include changes in the following areas:

1. Ensuring a uniform Wells process: While the update does not address the Staff’s practice of not providing any details as to the proposed charges in its Wells Notice, the updated Enforcement Manual emphasizes the importance of open, informed, and thoughtful dialogue between SEC staff and potential respondents and defendants, with the goal of producing better outcomes and ensuring the fair and timely resolution of investigations and recommendations of possible enforcement actions. – To encourage this dialogue and facilitate greater consistency in the Wells process, the Enforcement Manual updates provide that recipients of a Wells notice will ordinarily receive four weeks to make Wells submissions. The update also gives guidance on what makes a Wells submission most helpful to the staff and the Commission. The updated Enforcement Manual provides that Wells meetings will be scheduled within four weeks of receipt of a Wells submission and will include a member of senior leadership within the Division. – The processes and timelines set out in the updated Enforcement Manual are intended to ensure that the Division acts promptly to achieve the Commission’s three-part mission while also allowing parties affected by an enforcement investigation to learn more quickly whether the staff will recommend closure of an investigation or an enforcement action, as well as help ensure efficient use of Commission resources. 
2. Facilitating simultaneous consideration of settlement recommendations and waiver requests: The updated Enforcement Manual reflects that the Commission recently restored its prior practice of permitting a settling party to request that the Commission simultaneously consider an offer of settlement and any related request for a Commission waiver from automatic disqualifications and other collateral consequences that result from the underlying enforcement action. By providing potential parties to an SEC action with greater visibility into the collateral effects of a settlement, these updates conserve Commission resources, enhance the transparency of its processes, and protect investors by driving significant efficiencies in the resolution of investigations. 
3. Additional Updates to the Enforcement Manual: The updated Enforcement Manual details the Division’s framework for evaluating cooperation, including its impact on civil penalties. It also includes: changes intended to encourage more consistent internal collaboration, updates regarding the formal order process, an updated framework for referrals to criminal authorities, and other changes intended to conform the Enforcement Manual to current best practices within the Division.

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