How far did SEC enforcement fall in 2025?
The SEC filed 456 enforcement actions in fiscal 2025, down from 583 the year before. The agency's Enforcement Division shrank from 1,302 full-time equivalent staff in fiscal 2025 to 1,114 enacted for fiscal 2026, about 14 percent. The fiscal 2027 request asks for 1,168. The agency's operating funding was $2.149 billion in fiscal 2026, down from $2.199 billion in fiscal 2025, and the Enforcement program's budget fell from $693 million to $607 million, according to the SEC's fiscal 2027 budget request.
In our view, regulatory hiring reversed in 2026, and firms that staffed up for the 2021 to 2023 enforcement boom now carry more SEC defense capacity than the work supports. The 2021 through 2023 stretch pulled white-collar and SEC defense headcount higher at firms with serious regulatory practices, alongside antitrust merger-review capacity. In our view, most of that capacity now faces lower demand than forecast, and the work arrived later and in different parts of the practice.
- Fiscal 2021697
- Fiscal 2022760
- Fiscal 2023784
- Fiscal 2024583
- Fiscal 2025456
- 2021
- Total actions
- 697
- Standalone actions
- 434
- 2022
- Total actions
- 760
- Standalone actions
- 462
- 2023
- Total actions
- 784
- Standalone actions
- 501
- 2024
- Total actions
- 583
- Standalone actions
- 431
- 2025
- Total actions
- 456
- Standalone actions
- 303
| Fiscal year | Total actions | Standalone actions |
|---|---|---|
| 2021 | 697 | 434 |
| 2022 | 760 | 462 |
| 2023 | 784 | 501 |
| 2024 | 583 | 431 |
| 2025 | 456 | 303 |
Where did regulatory defense work go in 2026?
The agencies redirected resources more than they cut them. In May 2025 the Justice Department's Criminal Division narrowed its white-collar priorities to a set of priority areas such as health care fraud and trade fraud, which in our view moved resources away from some of the lanes that fed law firms in the last cycle. The SEC's fiscal 2025 release says about two-thirds of its standalone actions involved individual charges. The FTC's 2026 to 2030 strategic plan, finalized in April 2026, calls protecting children online one of the most important consumer protection issues of our time.
Regulatory defense work contracted, but unevenly. SEC public-company enforcement and big-ticket merger review both slowed in ways you can measure. The Justice Department won its first wage-fixing conviction at trial in April 2025, and the FTC's strategic plan names a Joint Labor Task Force. The FTC also amended its COPPA Rule in 2025.
Which regulatory practices are growing in 2026?
In our searches, children's privacy and data protection work is growing. Labor and wage-suppression antitrust is active too, now that the Justice Department has shown it will prosecute and has a conviction. AI governance work is growing at the firms we talk to.
In our view, the firms that quietly retrenched are the ones that scaled pure SEC and merger-review defense hardest in 2022 and 2023, and the ones expanding are building investigations and compliance groups, or privacy and AI-governance groups, faster than pure enforcement defense, because corporate clients want proactive risk work more steadily than they need someone to fight an active case.
Which firms are overstaffed in regulatory practice?
In our view, a firm that brought on a row of SEC defense laterals between 2022 and 2024 is now carrying that cost against a docket that came in well under projection in some areas. The first response across the market in 2025 was to slow new hiring. Firms turned to quiet repositioning. Senior associates moved out of pure enforcement defense into compliance and investigations, or into privacy and AI lanes. Junior-partner promotions thinned in the groups that hired hardest during the boom.
A regulatory group leader should stop hiring against the 2022 enforcement picture. The priority now is rotating senior associates into the lanes that are growing, before promotions stall and the strongest people start taking calls.
Should a regulatory associate move firms in 2026?
If you're a candidate sitting in a heavy SEC or merger-review practice at a firm that overhired, the question is whether your group is rotating into growth areas or being parked while the firm waits for the next cycle. Both are happening right now. Where you sit decides your next two years of assignments and your shot at promotion.
Ask how many people in the group moved into privacy or AI work in the last year, and how many are still staffed on enforcement defense. For a candidate with depth in those growth lanes, the 2026 market may run opposite to the headline.