Capital Markets & Securities Law Watch

The Securities and Exchange Commission (the Commission) has a longstanding policy under its No-Admit/No-Deny Rule (or the Gag Rule) that prohibits defendants from openly denying, or even criticizing, allegations made by the Commission after settling an enforcement action. The Gag Rule has come under scrutiny for its First Amendment implications and “muzzling” effect, even as the Commission stands behind the policy’s reasoning.