Overview
- The SEC rescinded its Rule 202.5(e) on May 18, 2026 and the CFTC followed by rescinding its comparable policy on June 3, 2026, removing the agencies' blanket power to bar public denials in settlements.
- The term “no‑deny” referred to settlement terms that stopped defendants from publicly denying agency allegations even when they did not admit liability.
- Both agencies said they will not enforce existing no‑deny clauses in prior orders, but each kept the authority to demand admissions or communication limits in specific cases.
- Lawyers and companies are advised to rethink settlement tactics and public relations because post‑settlement denials could affect parallel private lawsuits, disclosure obligations, and investor communications.
- The change aligns SEC and CFTC practice with most federal regulators even though courts in recent years had upheld the no‑deny rule, so the full effects on bargaining, litigation strategy, and market narratives will take time to emerge.