SEC’s Reg S-T Proposal: The End of “Fake” Filings?
Late Friday afternoon, the SEC issued proposed amendments under Regulation S-T aimed at promoting reliability and integrity of Edgar submissions. If adopted, the amendments could mark the end of an era for “fake SEC filings” that we enjoy blogging about so much. But there’s still cause for celebration. In addition to aiming to curtail fake filings, the proposal is also intended to improve administration of Edgar — for example, filing delays arising in connection with Edgar outages (which have been a problem lately). The proposed rule specifies the Commission can take the following actions to facilitate resolution of issues that arise in connection with Edgar submissions:
– redact, remove, or prevent dissemination of sensitive personally identifiable information that if released may result in financial or personal harm;
– prevent submissions that pose a cybersecurity threat;
– correct system or Commission staff errors;
– remove or prevent dissemination of submissions made under an incorrect EDGAR identifier;
– prevent the ability to make submissions when there are disputes over the authority to use EDGAR access codes;
– prevent acceptance or dissemination of an attempted submission that it has reason to believe may be misleading or manipulative while evaluating the circumstances surrounding the submission; and allow acceptance or dissemination if its concerns are satisfactorily addressed;
– prevent an unauthorized submission or otherwise remove related access; and
– remedy similar administrative issues relating to submissions.
The proposed rule provides that in certain circumstances, such as a threat to EDGAR, the Commission may take corrective action without first communicating with the filer. In such instances, the proposed rule sets forth a process for the Commission to notify filers and other relevant persons of actions it takes as soon as reasonably practicable.
Filers still need to ensure the accuracy and completeness of information in their Edgar submissions and in most cases, address any errors by submitting a filer corrective disclosure. The proposed rule will be subject to a 30-day comment period after publication in the Federal Register.
-Lynn Jokela, TheCorporateCounsel.net August 24, 2020
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