Securities and Exchange Commission Chairman Jay Clayton confirmed today that after serving for more than three and a half years, he will conclude his tenure at the end of 2020.

Clayton disclosed his plans to leave to staff earlier this year. His departure will give President-Elect Joe Biden the opportunity to select his own SEC chairman at the very beginning of an administration.

Clayton was sworn in on May 4, 2017, and will leave the SEC as one of its longest-serving chairs. 

While Clayton repeated often that he wanted to focus the agency’s resources on advancing the interests of Main Street investors, some investor advocates and policy critics have said he created a decidedly pro-industry agency that advanced Wall Street interests while failing to implement a uniform fiduciary rule for broker-dealers and investment advisors. While Regulation Best Interest and Form CRS fell short of that uniform standard, they will remain two highlights of Clayton’s SEC career and will undoubtedly be enforced by a Biden administration.

Wall Street, however, was not always pleased with Clayton, either, especially when it came to enforcement like the mutual fund share class disclosure initiative, which fined 100 firms and returned $139 million to investors. While groups such as the Financial Services Industry accused the agency of engaging in enforcement without regulation, the initiative encouraged advisors who had recommended mutual fund share classes despite the availability of lower expense classes to self-report and return money to investors to avoid a civil fine. The SEC also charged and fined several advisors that did not self-report. 

“Working alongside the incredibly talented and driven women and men of the SEC has been the highlight of my career,” Clayton said in a statement.  “I am proud of our collective efforts to advance each part of the SEC’s tripartite mission, always with an eye on the interests of our Main Street investors.  The U.S. capital markets ecosystem is the strongest and most nimble in the world, and thanks to the hard work of the diverse and inclusive SEC team, we have improved investor protections, promoted capital formation for small and larger businesses, and enabled our markets to function more transparently and efficiently.” 

Clayton also said he wanted to “thank President Trump for the opportunity, and the support and freedom, to lead the women and men of the SEC.”

In total during Clayton’s tenure, the commission obtained orders for over $14 billion in monetary remedies, including a record $4.68 billion in fiscal year 2020, and returned approximately $3.5 billion to harmed investors. The agency conducted over 10,000 exams, including a record for the number of investment advisor exams, with the total number of annual examinations in 2019 up more than 25% from 2016. 

Under Clayton’s leadership, the SEC’s Division of Enforcement established a Retail Strategy Task Force, Teachers’ Initiative, and Military Service Members’ Initiative to concentrate efforts to combat fraud and educate investors.  The Enforcement Division also brought thousands of cases and held individuals accountable, bringing charges against individuals in approximately 68% of its cases.

During Clayton’s tenure, the SEC paid approximately $565 million to whistle-blowers, including the largest single award in the program’s history—$114 million.
 
Despite the disruptions of the Covid lockdowns and the remote work environment for SEC employees it mandated, the agency experienced a historically productive rulemaking period under Clayton, advancing more than 65 final rules to date from the commission’s policy divisions and offices, many of which modernized and improved rule sets that had not been reviewed and updated in decades. 

To promote transparency and engagement with market participants, Clayton also established the practice of using the agency’s congressionally-mandated, near-term agendas as a transparent roadmap for xommission’s regulatory work over the next year. Under Clayton, the SEC has advanced an average of 86% of the initiatives on the near-term agendas.