For at least 30 years, the U.S. Securities and Exchange Commission has relied on private lawyers for some corporate misconduct investigations and for protection of the assets of firms already in hot water, but now this unusual version of outsourcing has become pervasive.
If the SEC’s increased reliance on private counsel to investigate potential malfeasance were likened to the spread of a virus, it has gone from “an occasional outbreak of flu to a pandemic,” said Joseph Grundfest, a Stanford Law School professor and an SEC commissioner in the 1980s.
