October 15, 2021
Businesses and business leaders who misrepresent, mislead, or obfuscate with regard to the prospect or performance of their business undermine public confidence in markets. Business entities and business leaders who misrepresent the truth about their firms, have their malfeasance uncovered, and still keep their ill gotten gains undermine the public trust in the America's democratic system as a whole.
Repeatedly viewing business scandals which often end with light or no meaningful consequences for offenders erodes Americans' confidence in the justice system and their belief in the rule of law. Rampant, public dishonesty has had and will continue to have a corrosive effect on American social, legal, and political institutions. If Americans hope to see these institutions strengthened, if they hope to see these institutions continue, the consequences for business malfeasance, for business hubris have to be public and they have to be severe.
At a time when American confidence in institutions is on the wane, the SEC's ability to \"claw-back\" compensation from dishonest private sector actors is incredibly important. No business and no individual can be perceived as being immune to or more important than the public will. By imposing public consequence, especially financial consequences, on deceitful businesses, the SEC will take an important step toward restoring Americans' faith in both business and government institutions.
Moreover, if market participants are confident that other market participants will be held to high standards with regard to veracity, the market will operate more efficiently and productively.