Methodology

The SEED team maintains a database of SEC administrative proceedings and civil actions filed against public companies traded on major U.S. exchanges and their subsidiaries, excluding those actions that contain only delinquent filing allegations.  The SEED team is working to expand the database to include information for other types of defendants.  The team collects information only from publicly-available documents released by the SEC (and publicly-available court orders, if resolution information is not released by the SEC). Each SEC enforcement-related document is analyzed by the SEED team and information on characteristics of each enforcement action is recorded.  The action enforcement characteristics collected and currently made available for the public in SEED include Defendant Name, Defendant Type, Public Company Parent (if applicable), SIC Code, CUSIP, Legal Case Name, District Court, Case Number or File Number, Allegation Type, Alleged Violations, Resolution Date, and Total Penalty and Disgorgement.

Defendant Name: Standardized name of the entity explicitly named as a defendant in the enforcement action.

Defendant Type: For each enforcement action, the defendant is classified as either Public Company or Subsidiary of Public Company based on the defendant’s status as of the date the enforcement action was initiated.

• Public companies are defined as those that traded on a major U.S. exchange as identified by the Center for Research in Security Prices (CRSP) at the time the enforcement action was initiated, or otherwise within the five-year period preceding the initiation.  Thus, public companies that traded over-the-counter or on major non-U.S. exchanges are excluded, as are companies that did not become publicly traded until after the enforcement action was initiated.
• Subsidiaries are defined as those entities that had a publicly-traded parent company at the time the enforcement action was initiated, or otherwise within the five-year period preceding the initiation.   

Public Company Parent: The publicly-traded parent company of the defendant at the time the enforcement action was initiated, or otherwise within the five-year period preceding the initiation.  Available only for defendants classified as Subsidiary of Public Company.  The public parent companies of subsidiaries were identified as those cited in the enforcement action document initiating proceedings when available, or those identified through SEC filings if no parent company was mentioned in the initial enforcement action document. 

SIC Code: Standard Industrial Classification (SIC) code associated with the defendant as of the enforcement action initiation date, or otherwise as of the latest available date within the five-year period preceding the initiation.  For defendants classified as Subsidiary of Public Company, the SIC code of the Public Company Parent is reported.

CUSIP: CUSIP associated with the defendant as of the enforcement action initiation date, or otherwise as of the latest available date within the five-year period preceding the initiation.  For defendants classified as Subsidiary of Public Company, the CUSIP of the Public Company Parent is reported.

Allegation Type: Each enforcement action is assigned a category describing the SEC’s primary allegation against the defendant. The allegation types presented are updated annually to be consistent with the SEC’s categorization of allegations in their public annual reports on statistics.

Alleged Violations: The specific statutory sections and rules the defendant is alleged to have violated.

Resolution Date: The date of the earliest document that mentions a resolution of the enforcement action.

Total Penalty and Disgorgement: 

• If available, the Total Penalty and Disgorgement figure is taken directly from an SEC document as presented.
• When Total Penalty and Disgorgement is not a reported figure, a sum is presented of the individual figures for Civil Penalty, Disgorgement, Prejudgment Interest, and Other Monetary Penalties. 
• If more than one document for the same defendant in the same action contains a penalty or disgorgement amount, the data from the most recent document containing a penalty or disgorgement amount is shown.
• Some penalties and disgorgement are shared with multiple defendants.  The database notes when a penalty or disgorgement is shared and reports the full shared penalty and disgorgement for each separate defendant without allocating the shared penalty and disgorgement among the defendants.