The important first step, assuming he is approved by the Senate, will be the appointment of a new director of the enforcement division.

Since 2009, two of the three directors were former federal prosecutors who worked under Ms. White in the United States attorney’s office in Manhattan. They adopted policies reflective of the approach of the Justice Department, like requiring some defendants to admit to violations and granting deferred prosecution agreements in exchange for cooperation.

As the S.E.C. recovered from the debacle over the failure to detect the Ponzi scheme perpetrated by Bernard L. Madoff, aggressive enforcement became the watchword. This was reflected in annual increases in the number of enforcement actions filed — even though some involved minor transgressions — and large corporate penalties that were promoted as signs of the agency’s renewed vigor in enforcing the securities laws.

Mr. Clayton told the senators that “there is zero room for bad actors in our capital markets.” Yet, he also pointed out that the penalties imposed on companies in settlements should be reduced because “shareholders do bear those costs and we have to keep that in mind.” He noted that greater deterrence was possible by pursuing individuals rather than seeking large payments from corporate violators.

The focus on individuals is similar to the policy adopted in 2015 by the Justice Department that conditioned credit for a company’s cooperation on providing evidence of individual wrongdoing by employees and executives.

The challenge in this approach will be that scaling back corporate penalties could send a message to corporations and Wall Street that they have little to fear from the S.E.C., which cannot pursue criminal cases, because they face only modest financial exposure if violations are uncovered. Without the threat of a significant monetary penalty, it will be an open question whether there will be real cooperation from organizations or just lip service about providing assistance while avoiding disclosures that might implicate current management.

Since the Justice Department adopted its new approach to corporate cooperation, there have been few individual prosecutions for violations inside companies. Even the indictment of six Volkswagen employees over their role in the rigging software to thwart emissions tests did not reach the upper levels of the company, and five of the defendants remain in Germany and so are outside the reach of the United States government.