We spoke to A Valerie Mirko, a partner at Armstrong Teasdale and leader of the firm’s Securities Regulation and Litigation practice. Valerie represents asset managers – including retail and wealth management firms – and private fund advisers, as well as broker-dealers, in US SEC enforcement matters as well as in connection with examinations and regulatory matters.

Valerie also has experience with inquiries, investigations and enforcement actions conducted by the FINRA and state agencies. In addition to her regulator facing practice, Valerie conducts internal investigations designed to advise and assist clients – including broker-dealers, investment advisers and public companies – in preventing or responding to regulatory actions.

Prior to joining the firm, Valerie was a partner in Baker McKenzie’s Litigation and Government Enforcement practice for several years. Prior to joining Baker McKenzie, Valerie served as General Counsel of the North American Securities Administrators Association (NASAA), the association of state securities regulators. She was General Counsel from 2015 to 2019, having joined NASAA in 2012 and taken on executive leadership duties beginning in 2014. At NASAA, Valerie actively contributed to federal-state regulatory coordination with the SEC and FINRA.

Tell us about yourself and what initially sparked your interest in SEC enforcement defense work?

I became interested in this practice area when I was a 1L Summer Honors intern in the SEC’s Enforcement Division (in the New York Regional office) 20 years ago, and I never looked back. I love what I do – I love advising clients through high-stakes securities enforcement matters, as well as through SEC examinations and complex regulatory matters. 

My practice now includes SEC, FINRA and state enforcement and regulatory matters – these matters are often multi-layered and allow me to use all my skills and experiences. I appreciate the opportunity to be a guide and resource to clients as we work through enforcement and regulatory risk and difficult decision points that impact their business. I also really appreciate connecting with other attorneys and compliance and regulatory professionals, as well as quantitative experts, whether in the context of a matter or other areas where we can collaborate on. And I appreciate the opportunity to work with my partners in mentoring and training associates.  

What has been the proudest moment of your career?

The reality of being a defense attorney in this practice area is that the biggest wins are the quietest ones. When we get an enforcement investigation closed, avoid an enforcement referral from an exam or negotiate a settlement with a civil penalty that is a fraction of what the regulator initially started with – these are usually the most meaningful wins for clients. These are the culmination of an enormous amount of hard work on the part of counsel, outside experts, and most of all our clients, who know more about their business than any outsider ever will.

As the leader of Armstrong Teasdale’s Securities Regulation and Litigation practice area, what are some of the key challenges your clients are currently facing?

We represent clients who are investment advisers, broker-dealers and public companies. Right now, their focus is on continuing to have robust compliance programs while managing market volatility and continuing to innovate and grow.

The reality of our work is that building a defense often means understanding a technology process or trading strategy or accounting process at a hyper granular level.

Given your previous experience in in-house compliance and legal roles and as general counsel at NASAA, what unique perspectives do you bring to your clients?

Having been in-house earlier in my career makes me pragmatic and commercially minded. Our clients need to keep their business operating even while everything else is going on with an investigation. And my time at NASAA allows me a unique window in assessing regulatory and enforcement risk from my experience with federal-state regulatory coordination.

With the evolving regulatory landscape, what do you see as the next major area of focus for SEC oversight and enforcement?

We are seeing a back-to-basics approach to enforcement. Recent speeches and public statements by the Commission and Division of Enforcement leadership have emphasized that efforts will focus on investor harm and on retail investors. Therefore, the following case theories are especially relevant: accounting and financial disclosure fraud, offering fraud, market manipulation, insider trading and breaches of fiduciary duty.

Building your skills and relationships will always be valuable.

Many clients that I work with are investment advisers, and I expect non-fraud fundamentals – including investment adviser compliance, valuation, billing and disclosure – to continue to be areas of focus. For broker-dealers, that will mean a continued focus on Regulation Best Interest compliance. I do not expect a continued focus on record keeping and off-channel communication matters and expect this Commission to move away from the outsized penalties for recordkeeping case theories that dominated headlines over the last few years.

What advice would you give to your younger self?

Building your skills and relationships will always be valuable. As a law student and as a junior lawyer, I knew that in the abstract but always wondered if there was some additional secret magic. Now I know – the magic lies in your skills and relationships. That is what makes people trust you – whether advising clients when you are at a firm or working with internal stakeholders and colleagues when you are in-house or in government.

Can you recommend a good movie?

I am particularly fond of Ocean’s Eleven and the Ocean’s franchise generally. But beyond that, I really like heist movies – they usually show highly choreographed collaborations, where each character has a key talent that benefits the larger effort or goal and where often the members of the ensemble did not all know each other prior to the heist plan. There are at least one or two large course corrections that are needed, often with ensuing hijinks.

Some spy movies have those attributes as well – more recently I really enjoyed Operation Mincemeat where there is a group of people who come together, with different core skills, to make the Nazis believe that the Allies would land in Greece in 1943 instead of Sicily.

Tell us an amusing anecdote about your work.

As you can tell from my last answer – I greatly appreciate efficient collaboration that leads to success, ideally with a side of humor. Our work however is high stakes and can be existential for some of our clients, so humor is not often appropriate.

But there is always a moment, usually in an internal firm-only conversation, as we are building a defense, where invariably someone says: “I went to law school because I was bad at math” or “since when was understanding technology processes so key to us doing our jobs as lawyers?” Or “I now know everything about this very specific type of security that only a very specialized segment of the market knows.” The reality of our work is that building a defense often means understanding a technology process or trading strategy or accounting process at a hyper granular level so that we can both advocate for our client and educate the regulator. By the time we present to the regulator we know it backwards and forwards, but the learning process can have its humorous moments.