We are now well into the new Trump administration. The President’s nominee to head the SEC, Paul Atkins, has now been sworn in. At the same time, the SEC is also dealing with the fallout from the U.S. Supreme Court’s decision last term in the Jarkesy case. In the following guest post, Sarah Abrams takes a look at what all this could mean for the SEC. Sarah is Head of Claims, Baleen Specialty, a division of Bowhead Specialty. I would like to thank Sarah for allowing me to publish her article on my site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Sarah’s article.
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Significant events within the last year have already driven a change in how and perhaps in what venue the SEC brings enforcement actions. In June 2024, the Supreme Court issued its decision in SEC v. Jarkesy, and on April 21, 2025, the SEC’s new chairman, Paul Atkins was sworn in. The following discusses the impact to date, with an important takeaway: the SEC has not slowed its filing of cases for securities violations.
After inauguration day, when Mark Uyeda was appointed as Acting Chairman, he and his fellow Republican Commissioner Hester Peirce reiterated their view that the former SEC Chair Gary Gensler consistently overreached in the enforcement area. Acting Chairman Uyeda also worked to implement the reduction in size of the federal workforce, with roughly 16% SEC’s overall staff leaving the agency through different programs after Inauguration Day, including early retirement and a $50,000 buyout.
Still, the agency has not yet instituted any across-the-board cuts, and the SEC and the Enforcement Division’s reporting structure is now streamlined with fewer “senior officers” in place. The regional directors who previously headed each of the SEC’s ten regional offices have been reassigned to other senior roles. Even during the time Uyeda was named Acting Chairman, through the end of the first quarter on March 31, 2025 (before Atkins took the helm), the SEC filed 26 stand-alone enforcement actions and also brought 19 follow-on actions, imposing various suspensions or bars based on the entry of an order in a prior civil or criminal proceeding.
Even with a leaner staff, the SEC continued bringing new cases and coordinated with criminal enforcement authorities. Chairman Atkins has begun his stated goal to “protect investors from fraud, to keep politics out of how our securities laws and regulations are applied, and to advance clear rules of the road that encourage investment in our economy to the benefit of all Americans.”
Under Gensler’s leadership, the SEC was very active in creating regulations in areas like Sustainability and Crypto, along with filing a variety of enforcement actions against private companies and individuals. These activities were often accompanied by press releases detailing the actions and their implications. Since Atkins’ became Chairman, three press releases have been issued, two of which are the SEC charges against individuals for fraud against investors discussed below.
Three recently filed SEC lawsuits in Virginia, New York, and Texas demonstrate the return to “bread and butter” enforcement actions against named individual bad actors who have allegedly committed fraud. The matters all involve Ponzi schemes and were filed in various federal courts with less announced fanfare or publicity than Gensler’s SEC.
By way of background, the Jarkesy case began in 2013, when the SEC commenced an administrative proceeding against George Jarkesy, a hedge fund manager, for securities fraud. Mr. Jarkesy argued, among other things, that the SEC’s use of its administrative tribunal and use of an administrative law judge (“ALJ”) violated his right to a jury trial under the Seventh Amendment. In its decision last year, the Supreme Court agreed.
In line with the Jarkesy holding, the following three SEC enforcement actions were filed in court, and with Chairman Atkins’ directives, against individuals who allegedly defrauded investors and misappropriated funds for personal use.
On April 22, 2025, the day after Atkins was sworn in, the SEC filed its Complaint against Ramil Palafox in the Eastern District of Virginia Alexandria Division, alleging he orchestrated a fraudulent scheme that raised approximately $198 million from investors worldwide and misappropriated more than $57 million of investor funds. The SEC alleged that Palafox created Praetorian Group International Corporation (PGI Global), which claimed to be a crypto asset and Forex trading company, promising large returns to investors. However, the Complaint alleges that Palafox misappropriated over $57 million for personal use, including luxury purchases and real estate.
On April 29, 2025, the SEC filed a Complaint in the U.S. District Court for the Eastern District of Texas against Kenneth W. Alexander II, Robert D. Welsh, and Caedrynn E. Conner (collectively the “Defendants”) alleging that the Defendants orchestrated Ponzi scheme that raised at least $91 million from more than 200 investors. The scheme allegedly operated through Alexander’s trust (Vanguard Holdings Group) and Conner’s trust (Benchmark Capital Holdings), falsely promising high monthly returns from international bond trading. According to the SEC, investors were paid using new investor money and Alexander and Conner also misused millions for personal expenses.
That same day, the SEC filed a Complaint in the Southern District of New York alleging Derek Taller orchestrated a complex fraud while managing two investment entities: Vision BioBanc Holdings, LLC and StHealth Capital Investment Corporation. Taller directed St. Health Capital and Vision Holdings to loan $21.875 million to two other companies in which he had undisclosed financial interests. One of those companies ultimately defaulted on its loan, leading to a $21 million loss. Taller failed to disclose his interest to the lending companies’ boards and co-mingled funds.
The foregoing enforcement actions contain egregious allegations of wrongdoing and securities act violations by the individuals named. There was a supposition that the Jarkesy decision, coupled with the new Trump administration, would blunt enforcement actions brought by the SEC. Within the first week of the Atkins SEC, that does not appear to be the case. Even if investigations started before the new administration and the SEC Chairman’s swearing in, the SEC’s move to file multiple complaints in federal court within days certainly appears to be a warning shot.
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