ASA Applauds SEC Action to Rescind Gag Rule

WASHINGTON – The American Securities Association (ASA) today applauded the Securities and Exchange Commission's action to rescind the "Gag Rule" that conditioned settlement of enforcement actions on a defendant's promise to never publicly deny the agency's allegations.

"ASA applauds Chairman Atkins for rescinding the Gag Rule and recognizing that the government may enforce the law, but it cannot permanently extinguish the First Amendment rights of every individual that feels forced to settle rather than fight," said ASA President and CEO Chris Iacovella. 

ASA filed an amicus brief earlier this year with the U.S. Supreme Court in Powell v. SEC, urging the Court to take up the case and strike down the policy as unconstitutional. Last month, Iacovella penned an op-ed in RealClearMarkets, "The SEC's Gag Rule: An Unconstitutional Bargain," noting that the Gag Rule silenced an estimated 2,700 individuals and businesses between 2017 and 2023, that the SEC was one of only just two federal agencies with such a policy, and that a defendant who fought to trial and lost retained more speech rights than one who settled. Today's rescission ends that imbalance.

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The American Securities Association (ASA) represents the retail and institutional capital markets interests of regional financial services firms who provide Main Street businesses with access to capital and advise hardworking Americans how to create and preserve wealth. ASA’s mission is to promote trust and confidence among investors, facilitate capital formation, and support efficient and competitively balanced capital markets. This mission advances financial independence, stimulates job creation, and increases prosperity. The ASA has a geographically diverse membership of almost one hundred members that spans the Heartland, Southwest, Southeast, Atlantic, and Pacific Northwest regions of the United States.