SEC tweaks enforcement rules

Robert Khuzami, director of the SEC's enforcement division, speaks last month.

NEW YORK (CNNMoney) -- The SEC is about to get tougher on Wall Street crime. A little bit.

The Securities and Exchange Commission said Friday that in certain cases, it will no longer allow defendants to settle complaints without admitting or denying the allegations against them.

The catch is that the change to this controversial policy applies only to cases in which defendants have been convicted of the same conduct in criminal proceedings, or in which they've admitted to the conduct as part of an agreement with law enforcement officials to avoid or delay criminal prosecution.

The SEC does not have the power to bring criminal complaints.

Defendants will still be able to reach SEC settlements without admitting or denying the allegations against them when there are no concurrent criminal convictions or admissions of criminal violations for the same conduct.

The change will prevent a repeat of the awkward scenario last month when Wachovia Bank, now part of Wells Fargo (WFC, Fortune 500), admitted to allegations of bid-rigging in the municipal bond market in a settlement with the Justice Department while simultaneously neither admitting nor denying them in a settlement with the SEC.

Only a "minority" of the agency's cases will be affected by the policy change, Robert Khuzami, director of the SEC's enforcement division, said in a statement. Cases like the SEC's much-maligned settlement with Citigroup last year will not be affected.

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