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Gurbir Grewal's meteoric ascent to the Director of the SEC's Division of Enforcement may seem charmed, but here Gurbir shares the tradeoffs and costs of the steps he took. Gurbir is uniquely down-to-earth for someone so public and prominent, and this interview went deep into the decisions and experiences that shaped his path.
Deep conversations with underrated lawyers.
This is Horam with Horam's Quoram. Today's interview is with Gurbir Greywal, who has to be one of the most interesting people in government. It's hard to imagine someone more down to earth and relatable in the offices that he's held. As a fellow New Jersey Punjabi, I've been thrilled to see his ascent, including his groundbreaking tenure at the New Jersey attorney general's office and new highs as director of the SEC's division of enforcement. In our interview, we took some time to explore the principles and experiences that shaped his path.
Khurram Naik:Here's Gurbeer. Last we discussed, I heard an interesting part of your story where I didn't realize you had this liberal arts college dream once upon a time. And so, you spent, I think it was a year at Bates, which is a really beautiful, school, private school in in Maine. And so my understanding is you went there because you wanted to study poetry. Tell me about is that right?
Khurram Naik:Poetry?
Gurbir Grewal:Not poetry. I I I wanted to be a writer. Writer. So I I wanted to write fiction. I I I just thought I it would be great to go to like this small liberal arts college in the woods in New England somewhere and just just find myself and and and, you know, express myself and and do something super creative.
Gurbir Grewal:And so I chose Bates College in Lewis And Maine.
Khurram Naik:But that's not super common among our crowd. Right? I mean, that's not like a that's not like a famous path that people are setting out to do.
Gurbir Grewal:Not that I know of. Think if there's a surefire way to disappoint your parents as a South Asian kid, it's to say, listen, you know that doctor thing, I'm not gonna pursue a degree in medicine. I'm not gonna pursue an undergraduate degree in science. I'm not gonna be an engineer. I'm not gonna even be a lawyer or computer programmer.
Gurbir Grewal:I'm going to, you know, go to a small liberal arts college in Maine, is gonna cost an arm and a leg, and I'm gonna, you know, pursue a creative writing path and and try to write a novel or do something creative, which which was not well received. I don't know what what your upbringing's been like or what what the preferred career choices were in your household. I'm an only child also, so all the eggs were literally in one basket. And that's what I wanted to do. And I think part of it was a function of my folks not knowing the system and me just saying, yeah.
Gurbir Grewal:No. This is a great college. Just you know, I need this check to to put the application in. Yeah. I got in.
Gurbir Grewal:It's a top liberal arts college and and sort of keeping them on the dark on certain things. Right? Because we didn't have, like, our parents at least I didn't, helping edit college essays or helping me prepare for SATs or or drilling me on SAT words. It was and I was alone, and it was just all me. I don't think I had the same sort of support that my kids now have.
Gurbir Grewal:They've got counselors who are super, into their development. It just was different then. And so, yeah, I did that. I went up to Maine. It was great.
Gurbir Grewal:They they obviously wanted to address diversity issues, so they brought me up for this, like, accepted students of color weekend. It was in the spring. I got on a bus from Port Authority, and I got on the bus, and it was just, like, a bus full of, like, you know, minority kids from New York City area going up to Bates to visit. I'm like, wow. This is pretty cool.
Gurbir Grewal:It's, like, seems like a a pretty diverse crowd. Like, it's gotta be great when we get up there, and it's not a very diverse place. Right? You're in the middle of, like, rural Maine. The college is the only thing in this old mill town, and it's tough, but it was a really accepting student body.
Gurbir Grewal:I I I will say that. And I spent the first, semester there taking English classes, taking classes in rhetoric. They had a major you can major in rhetoric. Mhmm. They had a great debate team.
Gurbir Grewal:I joined that, the Quimby debate council. And, you know, I took a class in in foreign policy, and I remember the professor's name, Jim Richter. I love that. Like, I had never even thought about international relations. And that prompted me to look at the course catalog at at Bates, and it's a small catalog.
Gurbir Grewal:And it became apparent to me that if I tried to pursue something different, I'd run out of classes in a matter of a year or two. Right? And so I had a roommate, who was looking to apply to different schools to transfer. He wasn't happy at Bates and I was becoming increasingly unhappy as the winter came around. The main winters are tough and so I started looking at transfer opportunities and I took one of his, transfer, catalogs and I I looked at the Georgetown application, which was for their foreign service foreign service school.
Gurbir Grewal:And I thought it'd be a great opportunity to, like, go try to be a diplomat and and represent the con represent The United States in far flung places. And so that's what I did.
Khurram Naik:So, you know, so to answer your question, yes, I had a very stereotypical South Asian background where, yes, I I was expected to go to med school, blah blah blah. Studied biology in college, went to a good technical college. And, then I kinda figured, okay. That's that's not what I want to do. And so then I I I kinda had a circuitous path that eventually led me to law school.
Khurram Naik:But so that training that I had, the science training popped up in different ways throughout my career. You know, I I ended up doing patent litigation, which heavily lean on that science background. But then just I think in general, like my inclination, which is very heavily influenced by the set of ideas that I acquired there, just a set of principles, methodologies you learn when you study the sciences, I think has affected my decision making since then. So in what ways do you think? I mean, I know it's not so rare for Laura to have the kind of humanities background that you've had.
Khurram Naik:But what are some of the ways you think some of that early training has echoed throughout your career? What are some of the ideas you mentioned one professor and his influence, are there ideas that you can trace to those formative years that have just kind of made a presence in your career?
Gurbir Grewal:Sure, I think at Bates, I really took it seriously about learning to be a good writer and they had a writer's workshop and they had a place, I forgot what it was actually called, where you can go if you're working on papers, you can sit down with professors who are there to help you edit your essays and help you think about, you know, making your writing more clear, whether it's creative writing, whether it's, you know, whether it was, you know, something more, you know, for for a history class or what have you. And I think that was the first time where I really appreciated the whole editing process about just sort of continuing to refine, your your written work product to just make it better, make it, crisper, and to make it, more economical, really, just to be more economical with your words. That that was a takeaway from my experience at Bates, and I think everywhere along the way, I've sort of built on that. I've been known to be a heavy editor, that that if I do get into a document or into, you know, a speech or something that I'm working on, I'll really spend time with him.
Gurbir Grewal:I'll really sort of, you know, edit things and then I'll sit down with folks to explain to them why I made certain changes, why I moved things around because it's hard having been an associate at a law firm just to get a document back where it seems like somebody just opened up a red pen and just bled on the page and not give me an explanation to to take that sort of, feedback. And so I think that's one thing. The the writing process I picked up early on. I think interestingly enough at Georgetown, where where my major within the Foreign Service, school touched on diplomacy. That's a skill you employ in all aspects of life.
Gurbir Grewal:You're studying world conflicts and you're studying, you know, resolution to conflicts and how things resolved in certain parts of the world and how they didn't and the value of diplomacy. I think in many ways, a lot of what we do as lawyers in litigation is diplomacy. We're trying to find a middle ground where we're addressing our clients' needs or in my case, know, meet the, you know, acquit the sort of the, you know, what we're trying to do, as a regulator to our responsibilities and understanding that, you know, there are always two sides to the story. There are mitigating factors on the other side and just try to find a middle ground. I think that's a through line in all litigation, because not everything ends up going to court and not, everything in court goes to trial.
Gurbir Grewal:I mean, you have judges pushing, arbitrations and mediations and ways to find a resolution short of trial. So I think that's something else, you know, as I think about it, probably is something, that I've kept with me from from the training at at the Foreign Service, school. So those are two things that I could think of.
Khurram Naik:Yeah. I like that. Is there a is there a decision that you've made, I think, traceable to some that you turn to some model of some specific conflict and said, okay, in this specific conflict, this is this is the issue. This was a resolution or this was the thing that wasn't resolved. It it was just something that tangible for you that, you know, you can you can trace or
Gurbir Grewal:I don't I you know, like some sort of game theory where I'm I'm sort of mapping things out and and figuring out if they if this happens and this happens and No.
Khurram Naik:Something more anecdotal, something more practical, I would say, like not not this abstract thing, like, if this is just like, you know, how the British dealt with this thing and blah blah blah.
Gurbir Grewal:Oh, no. I mean, I I I don't not consciously, maybe maybe, you know, unconsciously. But think when when you look at conflict and that's what I studied. I took a class called map of the modern world where your entire, class revolved around like looking at why borders formed in a particular place and conflicts and the divisions that fell along those borders. And understanding, you know, sort of the the the the religious fault lines, understanding cultural fault lines, understanding political fault lines, and how they've resulted in the map of the modern world that we have today.
Gurbir Grewal:And so I think that was, you know, something that I took with me to really sort of understand, you know, why does this happen? Like to try to make sense of what's happened in the Indian Subcontinent, right? What's happened in all parts of the world? We took had a professor John Esposito, this was in the early 90s, right? Who taught Islam and politics and we were talking about this, who talked about the issues that we're dealing with today, but talking about the Muslim Brotherhood in Egypt at the time and you know you see the through lines in all the issues that we've seen play out over the last twenty plus years.
Gurbir Grewal:So it was a great education in that regard as well, understanding everything that was happening in the world and understanding where those fault lines were and what the basis for those fault lines or what caused those fault lines in other words. And so I think, you know, I can't point to anything that I've studied where I said, oh, you know, like I I remember looking at this conflict, so this is certain there's some parallels here in, you know, trying to navigate a path forward with with law enforcement in New Jersey as we're trying to negotiate a policy. The core principle, right? To understand why people get so dug in to certain positions and understanding that you need to show a degree of respect because while you might not agree with where they're coming from, they they are adamant. Right?
Gurbir Grewal:They are adamant and they they are, you know, dug into that position and you're not gonna convince them, otherwise. But but there's an opportunity through conversation to find a middle ground. And I think oftentimes we overcomplicate policymaking. We complicate, you know, litigation. I mean, we comp overcomplicate these things because at the end of the day, it's just about sitting down, being transparent, being open as I was as AG when we're dealing with difficult issues.
Gurbir Grewal:This is why I'm doing this, right? This being clear and explaining what you're doing, why you're doing it, being willing to willing to hear from other people and then not be afraid to move on your policy and say, you know what, that's a good point. That open conversation I think is the path forward on so many of these issues and we tend to sort of over complicate things.
Khurram Naik:Who do you think really models that well?
Gurbir Grewal:Well, I mean, in my own experience, I can't think I'm sure if I I thought long and hard about it, there's somebody out there, you know, who I I see, you know, is able to go into a room, listen to different sides, and and find a middle ground. I mean, I I think Obama was somebody who who had that ability, I guess, to to really hear people and see them where they were and, you know, sort of exude compassion and understanding of people's perspectives and, you know, explain his policies in a clear manner. He he couldn't win everybody over, but he he was a great communicator in that way, I think.
Khurram Naik:Mhmm. So I I think, you know, we've already kind of we've already talked about some things in your career and and some straight lines, you know, through the different experiences you've had, AG, you know, in your current role as well. But I kind of want to start earlier and just kind of go through chronologically because I think some of the that we've talked before that'd be interesting sport in your career are the ways in which your path is not linear. I think it'd be very easy to conclude, you know, looking at the trajectory of your career that it's been this, you know, one step leads to the next and it's a logical next step. And, you know, I think you have a difference of opinion on that.
Khurram Naik:So I want to explore that. So what you do think of the best jumping off for that? Do you think they'll be starting, you know, when you're a county prosecutor? Like, what do think is the first nonlinearity you think you experience, let's say, your legal career?
Gurbir Grewal:So I'd start I'd go back to, you know, the decision on what to study and where to go to college, right? And that's what I mean by nonlinear and I talk about this quite a bit when I have the opportunity to talk to younger law students or to people who are looking for career advice. And the message that I try to share with them is that you need to be resilient because you may think that this is the path for you, but there might be something that gets in the way and you may have to shift course. That's what I mean by nonlinear. For example, like we talked about, when I graduated high school, I wanted to be an English major.
Gurbir Grewal:I wanted to write the next great American novel as we were talking about just a moment ago. I went to Bates, a small liberal arts college, I got there, I realized very quickly that I wasn't that great at creative writing. I realized very quickly that I didn't want to be in Maine. I realized very quickly that a small liberal arts college wasn't for me and I got exposed to something else. I got exposed and I got a taste of an international relations course which pushed me in a different direction and that direction was to consider going to the Georgetown School of Foreign Service to pursue a degree and get into the Foreign Service, to take the Foreign Service exam and be part of the diplomatic corps and go travel the world and represent the country.
Gurbir Grewal:And so, you know, I went to Georgetown, I was lucky enough to get in. When I was about to graduate, there was a hiring freeze at the State Department. President Clinton said we're not, you know, increasing the size of the federal government at this time. We're not gonna offer the the Foreign Service exam at this point. And so I didn't have a plan B at that time.
Gurbir Grewal:I had all my eggs in that basket that I wanted to stay in DC, study for this exam and go down this career path, but that door closed as well. And I came back to New Jersey and did not have a job, and just really didn't do much, frankly. I had the luxury to not do much at that time. A lot of folks don't have that luxury. And then that, you know, in those months, and I joke about it quite often, I was watching television and I was watching Law and Order and I saw Jack McCoy and I said, this is pretty good.
Gurbir Grewal:You know, I think I could do that. I've been good at talking on my feet. I've done debate, and so why not consider law school? And so when when that foreign, service career wasn't available, I pivoted to go to law school on a whim really. On a whim, I go to William and Mary because I wanted to be back in the DC area and you know, graduate from William and Mary and I get a job at one of the biggest law firms in Washington DC, a litigation shop and I would have stayed there, I would have been a litigator.
Gurbir Grewal:I had no desire for public service or to enter public service. I enjoyed being at a big law firm, I enjoyed all the trappings that come with it. My own challenges at big law, which I'm happy to talk about as well but again another event happens and that was September 11 and that was a turning point for many of us because you really sort of think about what you're doing then, and there and you think about all you're dealing with. I mean, we're dealing with an incredible tragedy as a country, but then we're also dealing with another tragedy that hit a lot of us and hit differently for us. We were othered then, we were made to feel as if we weren't American because of what we look like, the color of our skin, our names.
Gurbir Grewal:And I recall leaving the office after watching the towers fall with my colleagues, feeling that we were all coming together, walking onto the street and seeing people look at me and say things to me. And it already started that first night. I remember my mother called me and said, hey, you know what, be a little careful today because people who six who are in the city, you know, working, in New York City had a tough time leaving and they were being targeted and harassed because of what happened. Said, what are you talking about? Like, why would anybody do that to me?
Gurbir Grewal:You know, like I was born here, like I'm an American. And it was within a matter of days where that that notion just was completely, you know, I I I it was wiped away. I was not American to many people and so that set me off to think, you know, why is that the case? What can I do about it? And the more I thought about it, what I could do about it is go out there tell people who I was and to tell them why you don't have to look a certain way or believe a certain way to be American.
Gurbir Grewal:And the way I could do that in my mind because I was a litigator was getting into public service and so that tragedy and that patriotism that I felt as well pushed me to enter public service to become a federal prosecutor. And you know, don't want to keep going on and on, like it's just one thing after the next in that same sort of vein that's happened to me in my career. I was so happy being a federal prosecutor. It was so rewarding. I was promoting understanding through my work.
Gurbir Grewal:I was getting up in court each and every day and I can't tell you unless you've done it to get up in front of a lectern and say your name and say you represent The United States. First time you do that, the second time you do that, every time you do that is such an incredible privilege. And it's really just, at least to me it was like it never became old, it was always exciting, like I always felt nervous when I was saying it but I knew like looking in that courtroom like there are agents waiting for their next case, there's members of the public there, there's a judge, there's a jury, you could be trying a case, you could be in front of a grand jury, they're all looking at you and seeing The United States. And so that's why I did that and I would continue to have done that but for a call I got from Governor Christie. I ended up initially at the US Attorney's Office in Brooklyn, I moved on to the US Attorney's Office in Jersey.
Gurbir Grewal:Governor Christie, his office called me and asked me if I had any interest in being the Bergen County prosecutor. That's the county in which I live. I had no idea what the Bergen County prosecutor does, none, because my experience was in the federal system. So the person's on the line with me, I go online as he's talking to me and I'm looking up the Bergen County prosecutor's office, Chief Law Enforcement Officer of Bergen County, New Jersey County of at that time like 900,000, 70 municipalities, 72 police agencies, that's a uniquely Jersey thing that there were more police agencies in the county than there were municipalities and there were two municipalities that didn't even have police departments. Like it's a lot of law enforcement, 4,000 law enforcement officers, you're the chief law enforcement officer.
Gurbir Grewal:I'm like, wow, this would be great because it allows me to continue in public service, continue to give back, continue to promote understanding, continue to do all that right where I live. And at that time I had, three young girls and I said this would be great, like how great would this be for that next generation that I could go to their schools, I could you know be around them and people will see you know in that space that again, that same thing that this is part of America, that we are part of America because these are those frontline jobs that are so uniquely associated with what it is to be American. It wasn't by happenstance that like all these new immigrant generations gravitated to policing and gravitated to firefighting in New York City and other parts of the country, whether it's the Irish, whether it's the Italians, like it was intentional I think. And so I interviewed with Governor Christie, I remember walking in the door to his office and almost like sort of confessing as I walked in that I'm a Democrat and he looked at me, he goes, Kabir, don't worry about it.
Gurbir Grewal:I don't care about your party, I just want you to go do this job given who you are, your reputation, just call balls and strikes and that's all I want and if anyone gives you crap and use a different word, no one's gonna run up to Bergen County and defend more quickly than I do because at that point, in the context for that is he had appointed Sahel Mohammed as a Superior Court Judge, the first Muslim American Superior Court Judge in New Jersey and I think he must have been campaigning or was somewhere out on the trail and a woman criticized him for appointing Sahel Mohammed saying that he would impose Sharia law in Passaic County and he told her that she was bat blank crazy and defended him like passionately and based on that he said to me, if anybody ever gave you crap and he used more colorful language, I'll be there right by your side. That meant a lot to me and you know, I had the opportunity to go to Bergen County to be the county prosecutor was incredible. Know, I'm in the community, I'm in, you know, schools, I'm in church basements, I am there working on issues that I think are important like building police community relations.
Gurbir Grewal:This is well before all the events, recent events that we experienced over the last several years. But even then this was an important theme for me given other sort of incidents that happened that really raised tensions between law enforcement and some of the communities that we serve in that county. And importantly, I got to go into schools as I said. And the reason that was important for me and I shared this when I spoke at the event that we were both at, is I know how hard it is to be and again, I don't know your experience, but I know my experience. I know how hard it is to be someone who looks different and who wears a turban or wears a butkka or wears their hair or grows their hair as a young sick boy.
Gurbir Grewal:I remember being tormented. I remember being bullied. I remember being ashamed of what I looked like, trying to, like, sort of hide into the back of rooms or disappear. And I wanted to go out there because maybe there was a kid who was going through something like that but wasn't tough enough to get through it or maybe, you know, it affected them in a certain way. I wanted to be there so they saw somebody who looked like me in those classrooms.
Gurbir Grewal:And so I went, we did classroom visits every Friday to talk about the opioid epidemic. I went nearly every Friday to as many as I could, not because I was an expert on the subject, but because I wanted to be there for that kid or any other kid who felt bullied or othered or felt, you know, targeted because of, they may worship differently or look different, than their classmates. And you know that experience because after one those presentations, I did have a mother reach out to me at the Gurdwara where we worship here in Glenrock saying, hey, you visited my kid's class. You don't know how much that meant to him. He was on the cusp of wanting to cut his hair and lose his identity, but you you being there just sort of steeled them up a little bit and gave him a little bit of confidence.
Gurbir Grewal:Again, I don't know what happened to that kid, I don't know if he's still maintaining his articles of faith, I know at least for the time being I made it a little bit easier for him and so I continued to do that and it's the greatest job, know, one of the greatest jobs I've ever had, but then you know, I got recognized, for the work I was doing there and I got called, by Governor Murphy, and that set me on the path to be the Attorney General, which I did for three and a half years and I was doing that work and I got a call from the SEC saying, hey, doing terrific work in these spaces, we have an opening for our enforcement director, would you consider coming and talking to us? And so that's what I mean in a long winded way about things not being linear. Like I went from one career choice forced into another one, pursued a career in law, an external event, a massive incredible tragedy forced me to think about public service and think about what it means to be sick in America at the time and what it means really to try to do what I can to promote understanding and to make it better for others because there are so many people who can't articulate who they are and are targeted because they're new immigrants or they are targeted because they don't have that same ability to explain who they are and they may feel like they need to hide in the shadows and so that's what set me on that path and then doing that work, it got recognized along the way which prompted other opportunities and so maybe not the right, nonlinear is maybe not the right word but that's how I describe it.
Khurram Naik:I think maybe another lens on, I think your point is this is hardly some foreseeable process And if that's the point, then I think there's more we can dive into these decisions to make them, to really understand what were the jumping out points you would consider. Like what was the relevant opportunity cost? What were the trade offs? Let's go back to when your US attorney got this call from Chris Christie saying, hey, you can be a Bergen County prosecutor. What were the trade offs you had in mind?
Khurram Naik:Because of the trade offs from going to big law into public service was pretty obvious, comp and that sort of prestige, whatever. Clearly, it's driven by this value that you had of, hey, you know, it's really important as a sick to be an advocate for myself and others. But so what were the trade offs that you had to consider and confront? And what was the most challenging part of that decision?
Gurbir Grewal:Well, trade offs, I mean, they're obvious. Think at every point as I'm getting older in every job, now I have children and I'm at the US Attorney's Office. In my mind, had I not gotten that call, in my mind my career path is, Hey, you're the Chief of the Economic Crimes Unit here at the US Attorney's Office. You're overseeing the cyber unit, you're overseeing the prosecution of every major white collar crime in the District Of New Jersey. You know that the people who've held this job before you end up going to lead a practice group at a big law firm and end up making a great career out of it, end up making a good salary and it's just a terrific opportunity and you know you could do that, right?
Gurbir Grewal:Because you prosecuted these cases, you investigated these cases, you know what it takes to put them together and you know like how effective defense attorneys can can take them apart as well. So I think very much in my mind at that point was like, let's do this for a couple of more years. The kids are young and then we've done our public service, that motivation that brought us here to promote understanding to really go out there and make a difference, think, okay, you've made that difference, difference, right? Like you see more and more people now following your career path. And then when you get that call, you reset all of that and you start to think about it through a different lens and you push the sort of career and financial opportunities aside and you start thinking about, wow, this is another level.
Gurbir Grewal:You're setting policy, now you're in a more public facing role, now you're the person in this county of nearly a million people and you have supervisory authority over law enforcement and you go out in the community and you speak for law enforcement and you're coming up with public safety strategies in your community. It's the profile is greater, so the difference you're making by just showing up to work looking the way you do and believing the way you do. I mean the ripple effects of that are just I don't think you can measure them because putting aside the young child that I talked about, I've heard it from adults who might just wear a bandana to work who said, I go to the county building and I see your picture in the lobby in Bergen County. That gave me a little bit more confidence to wear my turban to work. I showed my boss your picture and said like, that's me too.
Gurbir Grewal:Those sort of things, right? Like what? What value do you put on that? I don't think you can. And so to me that opportunity that that the ability to make that sort of difference, the ability to give back in that way and make it better for others.
Gurbir Grewal:I could live in my current position and push that law firm salary aside take that opportunity to make a difference and do it for a little while longer. That's what I told my wife, let me just do this for a little while longer and then I think I could find that well paying job and plan for college for the kids and do all those things that would have been a little bit easier to do had I gone right to the law firm.
Khurram Naik:But so at, you you were saying, you know, at the time of making that decision, were, know, in the US attorney's office and you said you had no idea what the Bergen County prosecutor did. So how did you size up the opportunity to, I mean, the things you talked about, it seems like you could only really discover by doing the job like so. Or how did you get the condensed version of the impact after time of the decision?
Gurbir Grewal:So one of the things Governor Christie was doing was very, you know, at the time he became governor, he wanted to clean up local prosecutors offices throughout New Jersey. You're not only the person who's running law enforcement in that county, you run a huge office, you're hiring prosecutors, you're hiring detectives and what that in some places means is it becomes a patronage bill and the governor wanted to break that. He didn't want it to be like, oh, you know, we're gonna hire only friends and family, we're only gonna do this, know, we're gonna look the other way on these crimes. He wanted somebody who was a federal prosecutor to come in there again, like I said earlier, to call balls and strikes. He had put in place a couple of my former colleagues in other counties.
Gurbir Grewal:So I had a friend who was the Middlesex County prosecutor at the time, Andrew Carey, who was a colleague of mine as a federal prosecutor. I had a former colleague Grace Park who had put in Union County, another big county in New Jersey and so you know after doing the Google search and telling the counsel on the other side that yeah, I do want to continue this conversation. Of course I did my diligence in talking to those folks and saying, hey Andrew, what's this all about? Like how, you know, what does this opportunity look like for you in Middlesex? And going there and visiting him and assessing, know, and just seeing it, seeing the respect he commanded in the community among law enforcement, going and visiting his office and seeing how he had things organized and learning that way and talking to, like I said, others who had done the job or were doing the job.
Gurbir Grewal:That's what really truly gave me an understanding of what that role looks like.
Khurram Naik:And so so I understand, you know, the opportunity costs of going to private practice, and that's very steep. Understand it's a lot to forego. But in terms of moving from U. Attorney's office to Bergen County prosecutor to AG to head enforcement at the SEC. In any of those moves, is there any downside that you faced?
Gurbir Grewal:Yeah, I think, you know, one of the things I didn't realize is is when you go from being the Chief of the Economic Crimes Unit at the US Attorney's Office, sure, you'll do high profile cases but you're not in the public limelight. You're sort of, you're you're doing your work in court, you're not making statements to the press, you're not giving press conferences. When you become the County prosecutor, you're the voice of law enforcement, you're giving press conferences usually when something bad happens or you're giving press conferences when you're announcing an arrest or when you're issuing a new policy. You're also more high profile when you're making decisions. In my case, I had a police chief in one of my towns when I was a county prosecutor who had sent an email to his cops in his town that seemed to encourage them to engage in racially influenced policing.
Gurbir Grewal:One of the authorities that I had was to take over that, I had the ability to take over that police department, remove him from his position, relieve him of his duties and put in my own officer in charge from my office and investigate what was going on there. I did that, he was a very popular police chief that subjected me to all manner of scrutiny and criticism in the papers. So those are things I didn't anticipate. Those are costs or whatever you want to characterize them as that I didn't fully appreciate would be associated with being in the limelight. So I learned very quickly that I needed to have super thick skin because no one's going to take the time to understand every issue.
Gurbir Grewal:People have very strong beliefs and people are going to come after you and they're going to come after your family. Somebody's gonna say something to your children in school like, your dad did this yesterday or your dad was in the paper for this today. That's tough and those are things that only increased when I became Attorney General, those types of experiences and it became more and more difficult for me to deal with them as my children became older, as they began to read the papers and understand you know what was happening in the attacks, The political climate over the last five to six years has deteriorated and our discourse has deteriorated and I'm in a high profile position during that time hit from all sides and my children are hearing about it and it's hard to shield it from them. My wife, as well, who her patients would say things to her, you know, she didn't sign up for this, my kids didn't sign up for this. So those were things that I didn't fully anticipate or appreciate I'd be dealing with.
Khurram Naik:And in making these transitions, I'm really curious about the connections between these because, you know, it was interesting to talk about, hey, how did your training and rhetoric, you know, impact later on? How did, you know, your diplomacy experience impact later on? So I think there's some interesting mixing and matching to do. What are the ways in which your experience as Bergen County prosecutor do you think has uniquely influenced your role now as as head enforcement for the SEC?
Gurbir Grewal:I don't think it's directly influenced how my enforcement priorities, but I think what I learned when I became the Bergen County prosecutor where I come into an organization of three fifty plus people with a $36,000,000 budget where I have, I think at the time 110 detectives, 60 or 70 prosecutors and then the rest are support staff and then supervisory authority over law enforcement across the county. I learned a lot about how to run an organization, about how to make sure that we are hiring and retaining the best people, which I learned very early on, is important. You're only as good as the people around you, you're only as good as the prosecutors you hire and train. So that was something that I really placed an emphasis on, particularly on the law enforcement side because these folks out there, they have police powers, how do you make sure, you know, through the interview process, through the background check process, you're hiring people who are gonna do that role or do that job the right way? So you know, learning to build teams at that local level, learning to motivate folks, that's a skill that I picked up, I think really on the fly on how to manage and motivate folks, how to empower folks to make sure that they had the tools to do their jobs and how to hold people accountable when they fell short.
Gurbir Grewal:I think those are all things that I picked up at that county level. One of the things that I did and really this was through trial and error, I got to the prosecutor's office and I would get a briefing from one of my units because one of the things I wanted to do was not be in the weeds and micromanage, but I wanted to have an understanding of everything that was happening because if something happened and I got stopped on the street and somebody said, oh, you're investigating this matter or that matter, like what's going on with it? I didn't wanna know, there's no way I would know everything about it but I wanted to know generally what was going on, what was on our docket. So I would sit down periodically on a regular schedule with all my units. I'd have the command staff for that unit there.
Gurbir Grewal:I'd have the chief on the prosecution side there and I would go through like case reviews and I would when we had to make decisions on tough cases, I would go around the room and make sure I was being collaborative and letting people you know share their views because sometimes you're gonna say no, we can't move forward or sometimes you're gonna say we're gonna move in a different direction. That works if you hear people out, if you listen to them and you tell them why you're doing something in a certain way and you're clear about it, you're intentional. But when you have cops in a room, if you ask the chief first, you know what he thinks and everybody else is gonna parrot what the chief said. So it's a small experience but like now, like when I have a room full of folks, go to the most junior people first a team and ask them. I'm like, you know, you're closest to this case, tell me what you think.
Gurbir Grewal:So that was really good on the job training. I also got a lot of on the job training dealing with crisis. You know, when you're dealing with a murder or you're dealing with some event that's happened and being on the scene and knowing how fast things move and how, you know, the situation on the ground changes so frequently, that sort of trains you up for dealing with those sort of things in general. Know that you need to be clear headed, you need to get all the information in before you speak on it because you can go out at hour one and say something, it and could be completely wrong at hour two. The more you do that, the more credibility you lose.
Gurbir Grewal:But there's always that tension of trying to get out there more quickly and saying something more quickly. And so building on that at the AG's office, where now I'm responsible for 8,000 people across 15 or 16 divisions at the time, I couldn't do that with everybody. I couldn't have that level of interaction with everybody. So I learned about process and building out good structure and having a good system in place where, you know, I have a number of direct reports that I hear from, you know, every day as to what's going on and they're the ones who are managing down and then reporting up in the right way and learning how to build out that structure, learning also to create priorities because you know, if everything's a priority then nothing's and that's something I learned very quickly. So when I got into that role, every speech I gave, every opportunity I had to share with folks what my values were, what my priorities were, I would always talk about four things.
Gurbir Grewal:That these are the four things that we're prioritizing at the AG's office and they didn't change over the four years that I was there. And so I think, you know, the goal of that was if people, you know, looked anywhere or asked somebody you know what's the AG focused on, it was really built out around you know our priority areas whether it's reducing gun violence, addressing the opioid epidemic, addressing issues of police community relations and building out our capacity to engage in affirmative civil litigation which was the work that we did against the Trump administration and, using you know our power in court to stand up for our residents. So that's something that I picked up in that role that I really needed to be intentional in my communications and all that's come together in this role in the same way. I mean, lot of what we do here is blocking and tackling and it's reactive, you know, crimes happened or you know, frauds happened and we're going in there to investigate it. So it's really hard to say, oh, affirmatively we're gonna do these three things or focus only in these three or four areas.
Gurbir Grewal:But you can still say, you know, here's what's important to us, we're obviously going to continue to cover the waterfront of securities fraud violations but we're gonna pay a particular emphasis on these three or four spaces because that's what promoting investor confidence in our markets and restoring trust in our markets requires. So that's the way in which we're operating and just being very clear in our messaging and those are all skills I picked up along the way.
Khurram Naik:I think you talked about a lot of interesting components that have changed over time for your, where I think it'd be interesting to explore how they've changed over time. So one of the things you mentioned was your management style, how you motivate, how you get feedback. How has that changed over time? What are what are the ways in which your management style today is different than it was, let's say, in Bergen County?
Gurbir Grewal:I I think I've just become more patient. I've learned to listen more, and and I've become I've become just more intentional, more intentional in my communications with folks who work with me, letting them know what my expectations are more clearly, letting folks know in the right way they've fallen short in meeting those expectations. The challenge in government and leadership in government in particular is that we have very few carrots and we have very few sticks. You don't have the ability to move on folks as you would in private practice. There are a lot of civil service protections, are a lot of employment protections at the federal level and you don't have the ability to give the types of bonuses and money to incentivize work as you would in the private sector.
Gurbir Grewal:So you know the one thing you can do is tell folks in clear terms how you appreciate their work, message out constantly about our successes, celebrate the great work that's being done and the other way you deal with folks is to really be plain about your expectations, try to find the right fit for folks if not hitting it out of the park in this role, trying to find a role in which they can hit it out of the park and to work with them to find that where they can succeed. I mean, that's something you have to learn in government. I learned that all along the way where you've got to really just be patient and it's frustrating at times. So I think overall, I've learned to become more intentional and patient over the years.
Khurram Naik:And so tell me some more about You also mentioned learning to deal with the media and learning about there's considerations you have to make for when and what you'll present, what information. And so how have you become more sophisticated with leveraging media and understanding how government should use media?
Gurbir Grewal:Yeah. I mean, I think we again, we I'll I'll talk about my current experience. You know, there's this perception, and and it's born out in study after study, that we're not holding bad actors accountable, that, you know, large corporate actors are getting away with with violating the securities laws or violating, you know, laws writ large and and not being held accountable. And that's created a great deal of distrust and folks have, you know, begin to think that there are two sets of rules, one for the big and powerful and one for everybody else and that leads to decline in investor confidence. And again, are surveys that speak to this.
Gurbir Grewal:The problem is we're not communicating out effectively when we are holding folks accountable. We're not leveraging the communication channels that people use to gather their news from, right? We have just now begun to leverage social media as a means of communicating our enforcement actions. And we're beginning to do it more effectively, but for us to issue a press release that we've fined so and so corporate wrongdoer x millions of dollars and they've agreed to you know, these remedies that we've imposed in a particular case or that we're litigating against a big corporate actor or holding this particular CFO or CEO accountable in a litigation release, which only law firms are gonna read, that's not getting our message out there. So I think in this particular role, our chairman, our office of public affairs has been more effective in leveraging those communication channels that get the message out there that we are the cop on the beat, that we are, you know, making sure that people play within the chalk lines, that they're not they're not flouting our rules and they're not getting away with things.
Gurbir Grewal:So I think that's one real example in this particular role. The prior role, we've just dealt with so much. As AG, you're dealing with law enforcement issues. You're dealing with civil issues. You're representing the state in civil matters.
Gurbir Grewal:I ran a division on civil rights. I'm dealing with, I'm dealing with, of all things, gaming. I I had control and supervisory authority over the casinos. I'm dealing with the racing commission, the horse tracks, I'm dealing with, the Alcoholic Beverage Commission, the ABC and so, you know, there were so many different divisions all which were doing great work but the messaging wasn't getting out there. So we started very early on in 2018 trying to use social media, trying to be more thoughtful on how we were getting our message out.
Gurbir Grewal:And the other thing we did was when we were we were giving a press conference, you know, you learn how to communicate in in sound bites, which is a different way of talking because I don't think, people who are covering covering a press conference, you know, wanna hear chapter and verse, of everything that happened. They just want that fifteen second clip that they could put on the evening news and so that was different, right? So you're starting to now have folks write for you in a way that that sound bite is there, pause at the right point. That was something new to me. So early on as a County prosecutor, would go out there and say, hey you know folks, we're here investigating a homicide at 224 Main Street in any town, Bergen County.
Gurbir Grewal:Right now this is what we have. We have a victim age so and so, like I would do everything and I very quickly realized that the AG's office, I don't want to be the person giving the details, I just need to be the person giving the big picture thematic sort of presentation saying, listen, you know, the detectives are going to come here and brief you on what exactly transpired. I'm here to assure you that there's no ongoing threat to public safety here in the county right now, that the suspect's been apprehended, there are no additional victims, it's a tragedy but we're here to support this particular community. End of story, you know, hand it off to the next person. And that's hard when you're a public person that you want to be the person at the mic the entire time, but you're just there to give the big picture story and that's something I had to learn, you know, over the course of three and a half years.
Gurbir Grewal:And if you look at my press conferences, probably the beginning of my tenure as AG, they're probably longer and my remarks were longer, but I would, at the end was really just sort of giving the big picture, letting other people fill in the details and then answer the specific questions that reporters may have.
Khurram Naik:So something that I think would be interesting to pick up on is, I'm really fascinated with connecting your specific experiences and layers. I think another dimension I think there'll be interesting to pick up on is ways in which you've emphasized a lot of very hyper local work you've done. You've talked about showing up at these schools, talking about the opioid epidemic, and you've talked about going for runs with cadets and just having just boots on the ground, understanding what's happening in your jurisdiction. And I imagine that's more challenging now at the SEC. So what are some of the ways in which you're able or want to change how that office operates in terms of having more access to tangible problems people are facing?
Gurbir Grewal:That's a good question. I think all of that's made more complicated by the pandemic where we don't have as many touch points with communities that we serve, where we're not doing that same type of outreach that we might have done pre pandemic. So it's a challenge but there's also a lot of opportunities because we could be in more places, more you know quickly by appearing virtually. So one of the things that we're doing is we're doing a lot of speaking engagements at different law schools in particular to help in our recruiting efforts. We are hiring like crazy but we also want to make sure we're hiring in the right way and this is one thing where I didn't close the loop on what we were talking about earlier.
Gurbir Grewal:One of the things that I also picked up in my different experiences is the importance of having a diverse workforce and how hard it is to work to creating that. And so all along the way, whether it was at the county prosecutor's office, I wanted to work to address DE and I issues because when you don't see representation in the top ranks of law enforcement, I'm not talking South Asian representation, I'm just talking representation period of your communities, that breeds mistrust because if you're a community member and you don't feel as if you can connect to your cops or you know they're not gonna understand where you're coming from because they haven't you know lived your experience or you know they don't look like you, that's a barrier, and that's a reason why like affinity frauds persist. It's a reason why, you know, during the Trump crackdown on immigration, why you know someone who didn't have status might be afraid to come in and report an abuser who's taking advantage of her or him. And so you know, the goal to promoting diversity in law enforcement is to make sure you're having a better understanding of the communities you serve by reflecting them.
Gurbir Grewal:And so early on I did a lot of engagement with diverse groups at different criminal justice schools whether it's John Jay or other places where I can go out and talk about what a great career this is and do the hard work it takes to build diversity on the front end so you could build it later in your leadership ranks and the same thing with your prosecutors. So then when I went to the AG's office, I had a chief diversity officer, my front office because I thought it was that important to get this messaging out there that not only are we talking the talk, we're walking the walk and I would not turn down speaking engagements to law schools, to students, to affinity bar associations because I wanted to get the word out there that this is a great place to work, that this is a place where you could thrive and so I've continued that here and so your question was, how are we connecting at that local level or connecting in the same way that I was able to connect in prior roles, we're going to law schools. I'm speaking my own alma mater to a small group and it's sponsored by a group of law students who are first generation Americans who ended up going to law school.
Gurbir Grewal:They have a group at the campus and they invited us to come speak. It's by going and working with Howard Law School to set up a class there about a security seminar to talk about the careers available to folks at the SEC, to be at the law school and present and teaching and doing the hard work at that local level and connecting at that local level. It's by doing events like we did in San Francisco where we met, by going to a Bar Association event, even for a night or day and a half and speaking and meeting folks and making yourself available making yourself available for active mentorship. I connected with so many folks, at that conference, I joked about the LinkedIn request but I'm happy to get on the phone with folks that I met to give them this advice one on one because that I think is my obligation And so that's the way in which I'm doing that and staying connected with folks and trying to make that difference.
Khurram Naik:Yeah, I think it'd be interesting to pick up later on on changes that you think that the legal community can make and Bar Association can make because I think an interesting jumping off point is, so I reviewed your testimony recently before Congress on the SEC. And I think there's some interesting I think an interesting transition to this topic is, you know, it seems like a new priority for this to see is focus on gatekeepers, including lawyers. And so what are the ways in which, you you feel like lawyers and their culture can and should change?
Gurbir Grewal:Yeah, I don't think it's a new priority for us. Think if we're going to create a culture of compliance at firms, at broker dealers, any market intermediate, excuse me, if we're gonna create a culture of compliance at firms in the securities industry, we need those gatekeepers to be doing their jobs. We can't be everywhere, right? We only have 1,400 people in the division of enforcement and there are hundreds of thousands of registered entities throughout this country and so we can't be the cop on the beat at every broker dealer, at every investment advisor, at every issuer and so the lawyers who are fulfilling those roles as chief compliance officers, the lawyers who are fulfilling those roles in giving advice to their clients as to what's permitted and what's not permitted, they have to live up to their legal obligations and give the right advice. They need to speak up when they see wrongdoing and corporations and firms need to invest in robust compliance programs and so when gatekeepers fall short, that sends a terrible message to the public when we talk about trust, when you see lawyers engaged in misconduct, I can't think of, you know, I could think of few things that send a more harmful message out there about how the system is rigged than when you have lawyers cutting corners and encouraging, or facilitating misconduct and so that's why we're focusing, there and using whatever injunctive remedies we have, to hold, lawyers accountable and other gatekeepers accountable and I think it's gonna continue to be an important message because unfortunately we continue to see lawyers, accountants, other gatekeepers fall short of their obligations.
Khurram Naik:And let's tie this back to what you're just talking about. So you're just talking about the importance of being available to people. So not just at a conference where there's a group of people or even at a small group of law students, but even one on one conversations. So you're doing things that don't scale at all. And those are things that you believe have an influence and impact.
Khurram Naik:And I feel like that's a recurring theme because you talked about going to these schools and saying, hey. Maybe there's off chance this is influencing someone, and it did influence someone. Maybe that was the only person influence was that one kid. But it seems like to you that was worth it. All that effort, however many hours that was made it worth it to you, which I can understand.
Khurram Naik:But so tell me some more about how mentorship and that sort of guidance will mitigate some of the problems we're having now. Will it, won't it? I mean, there a connection between these two concepts where you believe this is important track and then here's the sufficiency you're seeing in the bar?
Gurbir Grewal:Oh, see. I mean, you know, I'm not sure that's the most efficient way to go about promoting better behavior among lawyers. I gave a speech in California to a securities bar, conference. It was sort of loosely titled Lawyers Behaving Badly Part two because part one is a speech that my predecessor Rob Kazami had given and part two was necessary because we continue to see, you know, gamesmanship by lawyers which frustrates the SEC process. And so, you know, speaking to a bar group like that and getting the message out there about how, listen, you know, this trust building that we're engaged in, all of us have a stake in it because when the markets work better, they work better for you, they work better for me, they work better for investors, people have more trust and so when you're playing games with privilege assertions, when you're playing games, when we're taking testimony and you're kicking witnesses under the table when you don't like the answer they're starting to give, when you're engaged in misconduct, out and out misconduct you know, in facilitating misconduct at a firm, that's not helping, that's not helping.
Gurbir Grewal:We all have a role to play in this and so you know, that's the way in which we're getting the message out and I'm getting the message out there effectively. I would tell people though, when I talk about active mentorship, I'll talk to anybody who reaches out to me to seek career guidance and one of the first things I tell them is you only have one opportunity, particularly new law students, or new lawyers to develop your reputation because you walk into your law firm, you're pretty much a blank canvas. But when you walk into that law firm, you have one opportunity to really start developing your reputation in the right way. And so develop that reputation early as someone who's a good team player, someone who doesn't cut corners, someone who puts in the work. And if you do that, that's gonna stay with you.
Gurbir Grewal:But if you develop a reputation early as to someone who doesn't help out a colleague, someone who cuts corners, someone who's not trustworthy, that follows you and starts to follow you pretty much forever because as big of a legal community as we are, it's not that big because if somebody is applying for a job, somebody's gonna know somebody at the law firm you're coming from or at your law school or, you know, and you're gonna make a call and you're gonna say, hey, what's she like? Or what's he like? And you want the first couple of words to be like, oh, great colleague, total team player, you know, does the work, great legal skills. You don't want it to be like, you know, I can't say anything like, I don't have anything good to say. And so that's what I mean, that's the type of advice I would give somebody and I think because, you know, because I sort of follow that playbook, I think that's a big reason when somebody picked up the phone at the governor's office, called the US Attorney's office and said, hey, you know, what's Graber like?
Gurbir Grewal:Reaction I think, you know, based on what's happened to date was positive because I've always valued that. I've always valued my reputation. I've always valued integrity. I've always tried to be a great team player. I've always tried to go out of my way for my colleagues.
Gurbir Grewal:I've tried to take pride in my work and so I think that's if you hew to those sort of principles, which are basic but you don't know how quickly they get lost by a lot of people who get pulled in a 100 different directions and cut corners, that's gonna address all these other sort of deficiencies we see when lawyers go off the tracks and it's gonna help people succeed I think no matter what path they take.
Khurram Naik:Let challenge you on that because is it really the difference between whether someone sat down and got that speech of, hey, you know, your reputation is the most important thing, and you don't work with someone that cut corners? I mean, is that enough? Because isn't any number that like, it can't be the case that the only people who are, you know, doing the kind of work that you're talking about, who are, you know, being aggressive with their privilege assertions, who are, you know, shaping witness testimony. It can't be the case as those are all the people who cut corners as such. I mean, any number of these people are probably great team players.
Khurram Naik:That's how they
Gurbir Grewal:got in position where they
Khurram Naik:are today. You know, are the problems something more systemic and not just based on individual character?
Gurbir Grewal:I'm not saying that this is the way you address, you know, every lawyer behaving badly. I'm just saying that this is one way in which I think you're on a better path than most. And this is sort of the strategy that's worked for me and I think this is what I look for when I'm hiring folks at a high level, I'll make those calls and I think there's value to just hewing to these simple principles. I'm not naive enough to think that it's going to solve all the world's ills and I'm not naive enough to think it's going to force lawyers to behave better. I think there's this tension in the legal community that you're a good litigator only if you're scorched earth and if you're fighting tooth and nail for your clients and there are some clients who want that and so they create this void that's filled by these lawyers who are all trying to say I'm gonna be your fighter and I'm gonna be the one that goes to the mat for you but I will tell you that those lawyers are not the ones who are most successful, in my experience with regulators like me.
Gurbir Grewal:It's the ones who are, you know, most measured, the ones who have a lot of credibility, the ones who you know, because it's a small bar, right? Like there are a, there are those folks like who we deal with a lot and we know their reputations, we know the ones we could trust, we know the ones where we've got to take sort of extra care with representations they're making on behalf of their clients and there's the ones that we don't trust at all, right? And that's how real that is and again, I don't think it's gonna solve everything but I think it's gonna help you fall into that category of being that more effective lawyer with more credibility.
Khurram Naik:Are those effective lawyers with more credibility part of firms that have participated more in a revolving door? Is that a benefit of a revolving door?
Gurbir Grewal:No, I wouldn't say so. No, I don't think that's, I mean, don't know, I haven't really sort of studied the benefits of the revolving door other than knowing what our processes are, knowing how to most effectively navigate the SEC process, there's certainly a benefit from folks, benefit if you come from the SEC, go to private practice because you understand this place. I will tell you, worked with the SEC for probably a decade and a half as a federal prosecutor or twelve years as a federal prosecutor and I only knew a narrow piece of the SEC. Knew the anti fraud violations, I knew the enforcement division and when I got here, it is such a broad remit. The policy divisions do such incredible work, the rule making divisions and so you don't know how the SEC process works until you've worked here.
Gurbir Grewal:So there's an advantage to folks who leave here how to navigate the SEC and I think they'll probably tell you that you're more effective if you really guard your credibility because a lot of times that's all you have when you're having a tough negotiation. Let me, I mean, along the way, like I've heard great speeches, I've heard from a lot of leaders, one that sticks with me which speaks to this point is, Jim Comey when he was a Deputy Attorney General, came to the US Attorney's Office in Brooklyn, I was probably a year or two there as a federal prosecutor, and he came there because morale was at an all time low in the Justice Department. There were all types of scandals taking place, and you know, the US attorney firings, I think were happening or had happened. And he came there and he said, Hey, to all of us assemble, and I remember it vividly, we're assembled in the ceremonial courtroom, this is probably like 02/2007, and he comes in and he says, listen, each of you were given an incredible gift when you became a federal prosecutor, you took that oath and you might not realize that you received that gift and you might not realize it till the first time you tell somebody what it is that you do.
Gurbir Grewal:And it might be at a party and you say, I'm a federal prosecutor and you might not notice, but those people will begin to listen to your words a little bit more carefully. And you may not realize you received this gift till the first time you go to a court and you're arguing a tough motion, right? And the judge can go either way, but goes with you you have this gift. And you may not realize this gift till the first time you go to a victim who is hesitant to speak to you, but you know, learns who it is you are and who you work for and opens up to you and tells you about what they've undergone or experienced. That gift that you don't realize you carry with you is a reservoir of trust and credibility.
Gurbir Grewal:It's with you. It's with you when you take that oath and it's with you throughout everything you do in this job and that reservoir of trust and credibility is a reservoir that's been filled by all the good deeds of the people who came before you, did this job the right way, didn't cut corners and added to that reservoir and left it more full for the next person than they themselves found it. But he said, Comey said, the thing about reservoirs is that while it takes generations to fill them, they could be drained in an instant. So your job as the recipient of this great gift is to guard that reservoir and leave it more full to the next person than you found it.
Khurram Naik:Do you have something else you wanna add to?
Gurbir Grewal:No, no, but I think that that's it for me. Does that solve all these problems that we're seeing in the legal profession? No, but does it underscore the value of credibility in this profession because it is a small world? Certainly. Does it underscore the need to do the job the right way?
Gurbir Grewal:In my mind, does. Think that perfectly captures how I think people should be practicing.
Khurram Naik:So with this reservoir metaphor, I think that'll be interesting to to jump to another point of your testimony. And so one of the things that you spelled out is, you know, trust, American trust in financial markets and institutions is at near historic lows. And you said, there's no single cause to this decline, repeated lapses by big businesses, large businesses, you said, gatekeepers and other market participants, coupled with the perception that we, the regulators, are failing to hold them appropriately accountable, have contributed to this decline. So on the subject of the reservoir, what are things you think that your predecessors did that drain that reservoir?
Gurbir Grewal:I don't think my predecessors drained that reservoir, and I don't think that's what I was implying in any of those statements. I think my predecessors, have all done this job, you know, with integrity and have done it, you know, incredibly well. I think there's a perception out there that we're failing to hold folks accountable. People say, why aren't you holding individuals accountable, right? When they engage in misconduct and you're only penalizing corporations.
Gurbir Grewal:That may be true on the criminal side at the Department of Justice but when you dig deep, my predecessors, 70% of the resolutions we've brought over the last five years have involved individual accountability. That message is not getting out there and that ties back to what we were talking about earlier that there are these perceptions there. There are repeated lapses by gatekeepers, that's why we need to send a strong deterrent message and so that's a priority for me. I'm not saying my predecessors didn't hold gatekeepers accountable but I know in this particular moment, I need to emphasize holding gatekeepers accountable. So when I had a matter involving Ernst and Young recently, a big four audit firm, What I chose to do in that case was make sure that there were admissions in that case.
Gurbir Grewal:Usually most of our resolutions are neither admit nor deny but in that particular case, because of a heightened need for public accountability, because they were a gatekeeper, I wanted admissions and our team negotiated admissions. I wanted a significant penalty so we had a 100 plus, $125,000,000 penalty I believe it was in that particular case. I wanted to include in that remedy undertakings where they were going to put in place compliance consultants and not only just compliance consultants to make sure they had adequate policies and procedures, but that they were also going to put in a separate consultant to review the misconduct in that case. In that case, the misconduct was auditors cheating on continuing professional education exams, including ethics exams. It was CPAs who were studying to be CPAs cheating on the ethics exams to become a CPA.
Gurbir Grewal:There's nothing more foundational to an auditor than to have good ethics. And so that's an example of where in how I'm fashioning a remedy, I'm trying to address what I'm seeing out there which is this deterioration trust. That's not to say that my predecessors didn't do that, they brought these cases, they brought great cases but they may have chosen to view penalties in a different way or not pursue certain remedies they were dealing with a different moment. I'm dealing with this particular moment and given the circumstances that I'm seeing right now, I think we need to pursue robust penalties and we need to pursue robust remedies and we need to create a culture of proactive compliance because that trust gap and deterioration is real in my mind.
Khurram Naik:So those are solutions for the problem. So you have a theory that an admission is a solution for public trust. What gives you the impression that admission has Like, if I ask someone on the street, hey, does it matter to you? Do you have more faith in public markets because Ernst Young admitted this wrongdoing? How do you know what the answer is gonna be?
Gurbir Grewal:Well, I think the people Well, I'll flip it on you, because the criticism I'm getting, and and that we get as regulators is that why do you resolve everything with the neither admit nor deny? How are you holding people accountable? What's that all about? You know, you're saying that they violated these securities laws, but in the resolution, they're neither admitting nor denying, the violation. They're not saying anything.
Gurbir Grewal:They're paying you a big penalty and maybe there's some other remedies attached to that, but how is that promoting accountability? That's out there. And so the flip side of that, I don't think there's anything that is more attention grabbing and could address, you know, people's concerns that folks aren't being held accountable than exacting admissions in a particular case. And so, you know, I haven't done the studies there but I just think, you know, based on those two scenarios, in the right cases, because we can't do it in every case, the majority of our resolutions will still be neither admit nor deny because otherwise we're not going to get things resolved, it's just not practical. But in the right cases where there's a heightened need for public accountability, where there's a, you know, a real recidivist, let's say or whether there's a threat to the public markets, whether there's, you know, something that we need to send a strong message on, in those cases we'll pursue admissions and in those cases we'll be willing to litigate if we don't get admissions.
Gurbir Grewal:And so, I think it's effective and I'm sure folks have looked at it too. I know that, you know, I don't know how you measure. It's hard to, I think, find measures like to say, did this, you know, deter misconduct altogether in a particular space, That's a tough question to answer, but I will tell you that it's caused market participants to change their behavior because they don't wanna be the next firm to have a resolution involving admissions. Because there are a lot of knock on effects too. When people admit to certain types of misconduct, they lose certain privileges.
Gurbir Grewal:You know, when they're broker dealers, they lose certain waivers and, you know, registration exemptions and things like that. So people are really you know, whether the public doesn't key in on it, market participants know how significant it is, and they they're changing behavior.
Khurram Naik:And so I think something else interesting you're you're saying about comparing previous regulatory regimes is it's not apples to apples because there's just a different era that we're in. And so recognizing that, when you said, Okay, so now you're approaching remedies and compliance and, you know, just using these different tracks as ways to increase public trust. But it seems like public trust is the North Star, you know, and that's what you're optimizing for now. What were your predecessors or predecessors optimizing for instead? Because it sounds like you said, you know, say on the subject of emissions and going, you know, with neither admit nor deny, you know, what you know, why was that you know, what was a relevant trade off that made that in the calculus more attractive?
Gurbir Grewal:Again, I don't want to speak for my predecessors and what motivated them. Know my immediate predecessors and the ones I know were focused on the same thing that I'm focused Our core mission is investor protection. It's ensuring the fair and efficient operation of our markets. It's ensuring and facilitating capital formation. That's a tripartite mission of the SEC.
Gurbir Grewal:They believed in it and they did what they thought was the right thing and the most effective thing to do to achieve that mission. I think to achieve investor protection, we also have to focus on restoring public trust and confidence in our markets, that's something that I've keyed in on. I think it's born out of my prior experiences because as AG, I did have the opportunity to speak to folks around the state and to speak in town halls across the country and the feedback I got, and I think it's still true, that whole pockets of this country have lost confidence in their government. We know that. We've seen that.
Gurbir Grewal:We've seen that play out in our electoral politics. And at the same time, they've lost confidence in our financial institutions because they don't think that the markets work for them. And because of that, they're you know, is it any wonder that why, you know, the crypto crash has hurt more minority groups than other groups? There are studies to that effect because these are folks who've, you know, in some cases felt like markets didn't work for them and saw crypto as something different and invested heavily in certain crypto products, which, you know, the bottom fell out of. And so that's something, you know, we need to be mindful of because if there's confidence in our markets, we're better able to protect investors.
Khurram Naik:So the the the three part mission, protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation, what are ways in which those can be trade offs or or intention with each other?
Gurbir Grewal:Intention with each other? I don't think they're trade offs. I mean, I think, you know, we have other divisions that are focused on, you know, making sure that market structure issues are addressed and corporation finance is addressing our registration regime that it's operating effectively. Investment management is making sure that investment advisors and private funds and others that are operating in that particular space are regulated. All of that, a well regulated market, a robust disclosure regime allows for investor protection.
Gurbir Grewal:It allows for the fair and efficient operation of our markets and allows when all that is working for capital formation, when you don't have trust, right? Just to bring it back to the trust point, are you really gonna part with your retirement and invest in the market? Right? If you don't really think that the market works for you, are you really going to invest in a retirement account? If you're not, like, then that affects everybody down the line.
Gurbir Grewal:It affects capital formation. It affects the fair and efficient operation of markets if folks are not putting their money in the markets, and that's bad for all of us. And so I think all of this works in harmony.
Khurram Naik:We one of the mindful that, you know, our time is running short here. I want to just get in a few more questions to explore your worldview, because I think it sounds like you are looking to leave your mark on this organization. And so I want to explore some of the things that you're going to do because our previous conversation touched on some of the legacies that you wanted to leave behind. So I guess, do you have a thesis at this point? What is the mark that you wanna leave on this institution?
Gurbir Grewal:Yes, you asked me that previously and so again, don't wanna be, I'm not trying to be difficult here at all. I don't think in those terms, I really don't. I didn't come into this job thinking like I'm gonna leave a particular mark. I didn't get into the AG job thinking I was gonna leave a particular mark. I didn't get into the the county prosecutor job thinking I would leave a particular mark.
Gurbir Grewal:I didn't become a federal prosecutor to leave a particular mark. I talked to you about my motivations for entering public service and and you know, I don't think my career strategies lend themselves well to this lens of opportunity costs and and trade offs and things like that. I've just tried to do the right thing, you know, and and I think, you know, if I could continue to make that impact that I wanted to make as a federal prosecutor, as a county prosecutor, I made that decision. I know you know there were consequences to my family as a result of it when I had the opportunity to become AG like I could do those same things that I was trying to do, first as a county, as a federal prosecutor, then as a county prosecutor, as an AG and along the way, the mark I wanted to leave was just to make sure that I did it the best I could, right? That I was just doing the work, that I was making it better for the residents of my county, as a county prosecutor, that I was making it better for the residents of my state, that I was pushing back on things that I thought were unjust, that I was addressing things that were important to me, issues that were important to me.
Gurbir Grewal:You know, one of the things we haven't talked about is the rise in bias offenses and crimes that we saw, you know, over the last number of years in New Jersey. I know how that type of intimidation affects whole communities, right? We lived it, I don't know how old you are, but in Jersey when we had the Dotbusters, you had people in Hudson County who were afraid to go to their mothers and they were afraid to leave their homes because you had a whole group of folks terrorizing the Asian American community, the Indian American community in Jersey City. So when things started to percolate again and you know more recently the rise in anti Asian hate, I was in a position to do something about it because I knew how deep those wounds cut and so like that's why I do this job. It's not like intentional in the way that you know, I want to leave this mark here or leave that mark there.
Gurbir Grewal:Think the way in which I leave a mark is just to say I came in here, I focus on these things that were important to me and I empowered the people who worked here. I had their backs and I supported their work and we protected investors as best we could and we tried to restore confidence in our markets. I firmly believe that that's the case, like I don't need to look at studies, I just think whether it's real, whether it's born out and like granular scientific data, there's this perception out there and so we need to continue doing our work and we need to do it in a way that gives folks, know, that people know that we are placing an emphasis on accountability and we're not letting people price in penalties as the cost of doing business, that we're taking bad actors and repeat violators out of the profession, that we're being thoughtful in the way we're crafting remedies, whether it requires admissions in a particular case or maybe not in that particular case. I'm just too focused on the now to think about legacy, right? You know, people are gonna say what they want to say.
Gurbir Grewal:Some people love the stuff I did in Jersey, other people hate it. I didn't do it because a particular group loved it or and I didn't do it to antagonize a different group, did it because I thought it was the right thing in that particular moment and I made a lot of hard choices then, but I really when I was AG I thought we were now I'm talking about policing issues, we were in a particular moment where I thought we were going to finally fix a lot of these structural issues and that moment's gone and unfortunately the momentum's, not there anymore to make bold choices and I'm happy about the legacy we left and the policies we put in place. I'm disappointed that more hasn't been done since but I wasn't doing that because of concern over legacy, I was doing that because in the wake of the killing of George Floyd, the wake of the Black Lives Matter protest, I wanted New Jersey to be a model of how we could get it right, how we could actually you know promote transparency and professionalism and accountability and law enforcement and bring communities together. And that's why Jersey didn't have that same experience other parts of the country did, where we had hundreds of protests but we didn't have the same types of violence that we saw in other parts of the country because we were doing that hard work and not because we wanted to leave that legacy but because we thought that was the right thing to do in that particular moment and so that's why we did it.
Khurram Naik:Yeah, it's interesting. I mean, I think there's probably some distinction between the word legacy that we're using because when I hear the things you're talking about, I hear about a lasting impact. I think maybe you're hearing me saying, Oh, like what's the prospective change I want to create here? But I guess, I mean, another way of saying it is, you know, your predecessors that are coming into your roles in Bergen County and AG. I mean, if you heard they just undid everything you did, it can't be the case you would say, oh, that's totally fine.
Khurram Naik:Just you're doing whatever's best. And it can't be the case that anything I did was was had an enduring value. I mean, it seems to me.
Gurbir Grewal:Think we're just talking around each other. Think what I hear your question to ask is like, you know, I hear legacy, it's like, you know it's about me. Right, yeah, I'm not like none of this is about me, right? So. Want to use as a county prosecutor, wanted to use all the levers that were available to me to make the lives of our residents better to address all those issues that we've talked about to now, you know, as effectively as I could.
Gurbir Grewal:Of course I'd be upset if people unwound those policies, right? I was hopeful that a lot of the policies we implemented at the AG's office would be codified in law but there hasn't been that will and again we've lost that moment I think to implement that type of lasting change, but I'm happy that I have those directives that are still in place there. Yeah, I'd be terribly upset because we put a lot of hard work. We're the only state that changed our use of force policy to make it more about respecting the sanctity of life than about talking about how and when we could use force. It a real sea change and cops bought into it and we retrained cops and we retrained 37,000 cops right before I left.
Gurbir Grewal:The last thing I did was attend those trainings, my last week as AG because it was just that was like sort of, know, that's the legacy I wanted, guess if I'm gonna borrow your word, I wanted to like change the way we did things for the better and that's same thing here, right? There's so much we could do more effectively, we could make the lives of our staff better, we could give them more tools, we could push back, you know, more authority to them so they could work more efficiently, we could message out more effectively that we're holding people accountable but I don't view that as anything that I'm doing for me but more doing all I can in this time that I have here to to, you know, address those issues that I care about.
Khurram Naik:Yeah, I think we're talking about the same thing now. Okay. So you and I talked about a shared enjoyment of a really great writer on financial markets, Matt Levine. And know, you you you when I mentioned Matt Levine, you said, oh, Elon, which was just like a catchphrase that told me, Okay, you're you're you're you know, deep cuts. So what do you think is something interesting?
Khurram Naik:I feel like Matt Levine has always really interesting frameworks for thinking about markets, market participants. What do you think is the most interesting or funny framework that just struck you and just something that you've thought about since that you've read from
Gurbir Grewal:him? I know if I know another reporter in this space that's able to just sort of break down complex financial instruments to break down crypto lending and break down all these like, what are really in some cases difficult issues to understand in a way that anyone can understand it and like that's such a skill and how prolific he is and how quick he is, you know, we could issue news on day, this morning and by his afternoon when the newsletter hits, he'll already have an analysis and have relatable real world examples and you know, related to his own experiences. He's a really talented lawyer and a really talented, reporter. Think in my mind, no one's able to sort of dive deep into what we're doing, and explain it in such a clear way and get it right most of the time you know, than Matt Levine. I can't, like I'm not gonna talk about a specific storyline or a specific article that that resonates because he's largely writing about what we're doing.
Khurram Naik:Yeah. I mean, there's always interesting there's, like, say, the boredom markets hypothesis. There's the Elon markets hypothesis. I mean, have any of those influenced your worldview or resonate with you in any way?
Gurbir Grewal:I'll just say that I read a lot, and I'm not gonna sort of highlight a specific theme that's resonated or informed my enforcement philosophy.
Khurram Naik:Okay. Very good. Thought I had you there. But yeah, okay, this is really great, Gerbir. I'm glad we took the time to talk and this is an interesting tour of your worldview and your experience.
Khurram Naik:Yeah, I really appreciate taking the time to sit down here.
Gurbir Grewal:Listen, my pleasure. And, you know, it's, I don't know, maybe when I sit down and look back at it, there's probably more structure to what I've done or something that I haven't thought about. But I really do mean it that I I it's I I was literally sitting in Disney World when I got the call for the AG opportunity. I was on vacation with my family and I was at the Little Mermaid with my then four year old where somebody called me and asked me about my interest in the AG position. I started the interview process.
Gurbir Grewal:I was at the AG's office it was on May 20, it's my anniversary, I get a text, from somebody who wants to talk, about this current opportunity. I wasn't soliciting it, know plenty of people have tried to audition for these roles, it's a great, I think it's the best job for white collar government lawyers, like it's the best position, it's a nationwide reach, you have such ability to do good here in a very complicated and challenging space and really set priorities. Again, wasn't looking for it. Got that email out of the blue and you and I have talked about this before and maybe this is something that's worked for me, I do think there's something to be said about just doing the work, about just putting your head down and doing the work because I think people notice. People notice at the law firm, people notice at the US Attorney's Office, people notice in government, people notice, you know, wherever you are.
Gurbir Grewal:The work speaks more than you could speak by trying to sort of hustle for a role and angle for an opportunity. Not that there's anything wrong with that, but I just think sometimes that becomes more you know, it just it's obvious to me that people excuse me. It becomes obvious to me that people, you you know, around me in these different roles who are just looking to get a leg up and and and cut a corner to to use that expression I used earlier, but it's different because I'd also noticed the people who do the work, and do the work for the right reasons. And I think that means more to me than a lot of lot of things when I'm sort of assessing talent.
Khurram Naik:Fair enough. Great final words.
Gurbir Grewal:Alright, man. Now I've gotta go by a