News & Analysis

SEC’s head of San Francisco office to leave agency

Jina Choi’s departure follows a string of recent high-level officials stepping down, with skills and leadership that can be difficult to replace.

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The director of the Securities and Exchange Commission’s San Francisco regional office will be leaving the agency Friday after more than 16 years of service, becoming the latest in a string of recent departures among senior officials.

Jina Choi’s departure leaves a void in enforcement, for which the requisite skills and leadership aren’t always easy to replace. Since becoming director in 2013, Choi helped to lead the charge for a number of enforcement cases that included financial reporting fraud and other securities law violations. As regional director, Choi led a staff of 130 enforcement attorneys, accountants, investigators, and compliance examiners who investigate and enforce the federal securities laws and perform compliance inspections in the San Francisco region. The agency also said Choi has made an impact on the agency’s examination program.

The SEC hasn’t announced her replacement.

Under Choi’s tenure, the SEC charged Oregon-based private equity firm Aequitas Management in March 2016 for “hiding the rapidly deteriorating financial condition of its enterprise while raising more than $350 million from investors,” according to the SEC’s website. Aequitas then went into receivership.

The SEC has been facing turnover in leadership at a time it seeks to add to its ranks. An annual report released by the Enforcement Division showed a 10 percent decline in its unit in the two years to 2018. Since late 2016, the agency has labored under a hiring freeze, which has raised concerns about its ability to handle enforcement issues in private equity.

Among other high-profile departures, the co-chief of the Enforcement Division’s Asset Management Unit, Anthony Kelly, left the SEC this month. In September the SEC also announced the departures of chief information officer Pamela Dyson and Christopher Hetner, senior advisor for cybersecurity policy to SEC chairman Jay Clayton.

One of the highlights during Choi’s leadership was the SEC’s charge of Elon Musk, founder of Silicon Valley-based Tesla, for securities fraud for a series of misleading tweets about a potential transaction to take Tesla private. Musk was ordered to relinquish the role of chairman and to pay a $20 million penalty.