Business Commons^™

Individual Lawyers, The Sec Revolving Door, And Comment Letters, Michael Shen, Teck Meng Junior Tan

Research Collection School Of Accountancy

Government officials, advocacy groups, and the business press have raised concerns thatformer SEC employees may continue to influence the SEC after leaving the agency. Usinga hand-collected database of individual lawyers that represent firms in responding to SECcomment letters, we examine the impact of individual lawyers, and lawyers formerly employedby the SEC, on the comment letter process. We document significant differencesbetween lawyers and law firms in their clients’ resistance to SEC comment letters, and findthat firms that retain former SEC employees are larger, more profitable, and more likely tohave received a comment letter raising accounting issues. After matching on lawyer, commentletter, …