A Harbinger of the SEC's Tough New Approach to Public Company Reporting Fraud

The Securities and Exchange Commission typically seeks to transmit its strongest “message” cases with bold headlines and marquee-name defendants. But occasionally the best indicators of where the agency is headed can be found in the smaller cases that might otherwise fly beneath the radar. One such harbinger of things to come may be detected in an enforcement action filed in late July, an internal controls case involving a small (and bankrupt) public company and facts old enough to be outside the statute of limitations.