May 12, 2020 / 8:15 PM / 23 days ago

Tips to U.S. Securities and Exchange Commission surge in recent weeks -official

WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission (SEC) has handled a surge in tips, complaints and referrals and opened hundreds of new probes since mid-March despite being forced to work remotely due to the coronavirus outbreak, an official said on Tuesday.

The agency has received over 4,000 such tips since mid-March, representing a 35% increase over the same period a year ago, Steven Peikin, co-director of the SEC’s Enforcement Division, told attendees of a virtual conference. During the same period, the SEC has opened hundreds of new investigations into violations of securities law, many related to COVID-19, the disease caused by the novel coronavirus.

“We can’t permit the crisis to be used as a cover for gamesmanship,” Peikin said on Tuesday.

Investigators and other agency officials have been teleworking since mid-March due to concerns over the spread of the disease.

The SEC has formed a “steering committee” of about 24 leaders from across the agency to identify areas for misconduct related to coronavirus, Peikin said, noting the agency has seen an “explosion” in microcap fraud with specious claims related to the pandemic.

The SEC has already suspended trading of roughly 30 companies over concerns or questions about the adequacy and accuracy of information related to claims about coronavirus tests, treatments and medical supplies, vaccines, disinfectant sprays and non-contact temperature screening.

Peikin said he expects more of that to come, as well as revelations of past or new misconduct related to the recent financial market declines.

The agency’s co-directors of enforcement in March also warned company directors, officers, employees and consultants and others with access to material, nonpublic information against insider trading.

Reporting by Chris Prentice; Editing by Chris Reese and Bill Berkrot

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