What a regulatory investigation means

Stages before an investigation

At the US Securities and Exchange Commission (SEC), information from tips or other sources may lead staff to open a matter under inquiry (MUI). The SEC Enforcement Manual says MUIs are preliminary in nature and typically involve incomplete information ¹. An investigation can follow an MUI or be opened independently ¹.

The SEC received 53,753 tips, complaints and referrals in the fiscal year to 30 September 2025, about 19 percent more than the year before ².

At the UK Financial Conduct Authority (FCA), an enforcement operation opens when the FCA appoints investigators under the relevant law, typically Part XI of the Financial Services and Markets Act 2000. One operation may cover several firms and individuals ⁶.

Is the investigation public?

SEC investigative proceedings are nonpublic, except where the Commission orders otherwise ¹. Under a formal order, the Commission designates staff to act as officers of the Commission in the investigation ¹.

The FCA kept its exceptional circumstances test for announcing investigations into regulated and listed firms when it published an updated Enforcement Guide on 3 June 2025 ⁵. It added three situations where it may say more: suspected unauthorised business, investigations the subject or a public body has already made public, and anonymised announcements. The changes apply to investigations launched on or after 3 June 2025 ⁵.

From investigation to accusation

A person who receives a Wells notice may make a written submission. US regulations say persons involved in investigations may submit a written statement to the Commission setting out their interests and position ³. The Manual says written Wells submissions should be limited to 40 pages, not including exhibits, and allows the recipient four weeks in the absence of timing constraints ¹.

How investigations end

Many investigations end with no action. Of the 36 FCA operations closed in 2025/26, 20 (56%) led to enforcement action and 16 (44%) closed with no further action ⁶. In 2024/25 the FCA closed 81 operations, and 42 (52%) closed with no further action ⁶.

The SEC says its fiscal year 2025 enforcement results do not include 1,095 matters that were investigated and closed ². When staff decide not to recommend an action, the Division's policy is to notify the person at the earliest appropriate time by a termination letter ¹.

In EU competition cases, the Commission can adopt a prohibition decision, which formally finds an infringement, or a commitment decision, which makes commitments binding without establishing an infringement ⁷. Regulation 1/2003 states that Commission fining decisions are not of a criminal law nature ⁸.