In an early sign of the priorities of the new administration, the SEC recently announced a new Cross-Border Task Force within the Division of Enforcement. According to its press release, the initiative is designed to sharpen the agency’s focus on foreign-based companies and market participants whose activities may harm U.S. investors, particularly through market manipulation schemes on US exchanges or otherwise.
The SEC’s new Cross-Border Task Force and recent enforcement history signal sustained, and likely escalating, cross-border scrutiny, particularly for China and Hong Kong based issuers, Chinese auditing firms, and firms that work on China-related deals.
In line with the Trump Administration’s America First Investment Policy and perhaps in response to entreaties from Congress and state regulators to protect the U.S. capital markets from unscrupulous foreign actors, the SEC announced the formation of a Cross-Border Task Force within its Division of Enforcement on September 5, 2025. The task force will focus on investigating foreign-based issuers for potential market manipulation, such as pump-and-dump and ramp-and-dump schemes, and will increase scrutiny of gatekeepers, particularly auditors and underwriters, who help foreign issuers access the U.S. capital markets. The statement notably singles out China as a jurisdiction where governmental control and other factors pose unique investor risks.
Chairman Paul Atkins identified auditors and underwriters as potential targets because of their “gatekeeping” role in helping foreign issuers tap U.S. capital markets. The Chairman explained that while the US capital markets welcome foreign issuers seeking to raise capital from US investors, that geographic distance will not shield bad actors from accountability.
Division of Enforcement Director Margaret A. Ryan noted that the Task Force will leverage the Commission’s investigative expertise to detect and deter transnational fraud, with early attention on companies from jurisdictions—such as China—where unique structural risks can compromise the investor protections enjoyed by American investors.
The Task Force’s focus is consistent with statements that Chair Atkins and Director Ryan recently made regarding the Enforcement Division’s focus on fraud, market manipulation and conduct that leads to investor harm.
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