WASHINGTON, Feb 21 (Reuters) - U.S. securities regulators are weighing whether to revive use of a 1930s law to pursue people who help others violate securities laws, a U.S. Securities and Exchange Commission official said on Friday.
"I'm hopeful ... you are going to see it reappear again in the coming year," said Joseph Brenner, the SEC enforcement division's chief counsel, at the Practising Law Institute's SEC Speaks conference.
"It's a really powerful statute with a lot of potential applications to investigations we are doing now," he added.
The law, Section 20b of the 1934 Securities Exchange Act, has not been used by agency investigators since the 1930s, he said.
Historically, the SEC has gone after such helpers under "aiding and abetting" liability, which requires the SEC to prove both that the underlying violation occurred, and that the other individual helped it occur.
Courts have narrowed the SEC's ability to pursue such cases in recent years, leading the SEC to look again at its rulebook.
Section 20b does not require the SEC to prove the underlying violation in order to go after the person who may have helped it to occur.
If, for instance, a company representative unknowingly makes a statement to investors that is false, the SEC would likely not go after that individual. However, a separate employee who knowingly provided the erroneous information to the representative could be held liable. (Reporting by Aruna Viswanatha; Editing by Karey Van Hall and Lisa Shumaker)