Study: U.S. securities fraud settlements in 2011 are lowest-ever since enactment of SOX

Numbers are expected to rise again in 2012

This year is the 10th anniversary of the Sarbanes-Oxley Act (SOX), the landmark legislation designed to make companies more accountable for securities fraud. In a surprising twist, a study by Cornerstone Research reported Wednesday that U.S. securities fraud settlements took a nosedive in 2011, resulting in the smallest number and size since SOX was enacted.

Even more surprising is that this occurred the same year that the Securities and Exchange Commission (SEC) filed the most enforcement cases ever in its history—735 to be exact. The SEC approved only 65 securities fraud settlements in 2011, which totaled just $1.36 billion. In 2010, the agency approved 86 settlements that totaled $3.21 billion.

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