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Investor Bulletin: Delinquent Filings
The Securities and Exchange Commission's (SEC) Office of Investor Education and Advocacy is issuing this Investor Bulletin to provide investors with information on the SEC's Delinquent Filings Program.
The Securities Exchange Act of 1934 (Exchange Act) gives the SEC the authority to suspend trading in and/or revoke the registration of companies that fail to submit disclosure documents (periodic reports), submit deficient periodic reports, or fail to submit periodic reports in a timely manner.
Under the Exchange Act, certain companies with publicly traded securities (reporting companies) are required to provide investors on a regular basis with periodic reports that contain important financial and business information. Examples of these reports include the annually filed Form 10-K or Form 20-F, and the quarterly filed Form 10-Q. Periodic reports help investors to make informed investment decisions about the purchase or sale of a reporting company's securities.
Most reporting companies submit their periodic reports in a timely manner. However, some reporting companies fail to submit periodic reports, file materially deficient periodic reports, or do not submit the reports in a timely manner. The timely and complete submission of periodic reports provides investors with information to help them make informed investment decisions. The SEC's Divisions of Enforcement and Corporation Finance jointly established the Delinquent Filings Program in 2004 to encourage reporting companies that are delinquent in filing their periodic reports to submit their periodic reports or rectify deficient periodic reports. The SEC's Delinquent Filings Group in its Division of Enforcement conducts investigations into possible violations of the federal securities laws' periodic reporting obligations, and prosecutes administrative proceedings against these companies when appropriate. The Division of Corporation Finance identifies reporting companies that are delinquent filers and usually provides them with notice of their failure to submit periodic reports. If a reporting company identified as a delinquent filer fails to submit its periodic reports, the SEC may revoke the registration of the reporting company.
Section 12(k) of the Exchange Act gives the SEC the authority to suspend trading in a security for up to 10 trading days if the SEC believes that a suspension is required to protect investors and the public interest. A trading suspension by the SEC halts the trading in a security on all trading platforms (e.g., national securities exchanges, over-the-counter market, or alternative trading systems). In addition, Section 12(j) gives the SEC the authority to revoke, or suspend for up to twelve months, an issuer's securities registration if, after an administrative hearing, the SEC finds that an issuer violated the Exchange Act by failing to file its periodic reports.
Investors may also find a list of companies whose stock is currently subject to an SEC trading suspension, or which previously has been subject to an SEC trading suspension, on the SEC's website at http://www.sec.gov/litigation/suspensions.shtml. For additional information on trading suspensions, please read the SEC's investor bulletin "Trading Suspensions" at http://www.sec.gov/investor/alerts/tradingsuspensions.pdf.
Finally, some companies with publicly traded securities in the over-the-counter securities market may not be required to provide periodic reports. For additional information on these companies, please see the SEC's "Information About Some Companies Not Available From the SEC."
To Report Possible Delinquent Filings Violations, please notify the Delinquent Filings Group at: DelinquentFilings@sec.gov, or call (202) 551-5466.
For More Information on the Delinquent Filings Program, please visit:
SEC's Delinquent Filings Program webpage on the SEC's website at http://www.sec.gov/divisions/enforce/delinquent.htm
SEC Releases Related to Delinquent Filings at http://www.sec.gov/divisions/enforce/delinquent/delinqindex.htm
The Office of Investor Education and Advocacy has provided this information as a service to investors. It is neither a legal interpretation nor a statement of SEC policy. If you have questions concerning the meaning or application of a particular law or rule, please consult with an attorney who specializes in securities law.