S.E.C. to Change Policy on Companies" Admission of Guilt WASHINGTON - The Securities and Exchange Commission is making a major change in how it settles some securities fraud cases, telling companies that they will no longer be allowed to say they neither admit nor deny the commission's civil charges when, at the same time, they admit to or have been convicted of criminal violations. The change has been under consideration for some time and could be announced soon, according to people who have been briefed on the new policy. The S.E.C. will continue to use the "neither admit nor deny" settlement process when it alone reaches a deal with a company in a case of civil securities law violations, the people briefed on the policy said. Those types of cases make up the majority of its settlements. The S.E.C. has been sharply criticized, in federal court and on Capitol Hill, for allowing companies to repeatedly settle fraud cases without admitting or denying the charges. That policy has been allowed to continue in cases even when a company admits the same conduct to another government agency, often the Justice Department. For example, the S.E.C. and the Justice Department announced on the same day last month that Wachovia bank would pay $148 million to settle charges that the bank reaped millions of dollars in profits by rigging bids in the municipal securities market, one of several such settlements announced last year by the two agencies. In the Justice Department settlement, Wachovia said it "admits, acknowledges and accepts responsibility for" manipulating the bidding process in the sale of derivatives on tax-exempt bonds to institutional investors like cities, hospitals and pension plans over a six-year period ending in 2004. But in fashioning a settlement with the S.E.C. based on the same facts, Wachovia agreed to settle the charges "without admitting or denying the allegations." The "neither admit nor deny" practice has been in use for years by many government agencies in addition to the S.E.C. But it has attracted renewed criticism recently. In November, a federal judge in New York rejected an S.E.C. settlement with Citigroup over securities fraud charges, saying that the "neither admit nor deny" language deprived the court of the facts necessary to determine if the punishment was adequate. The S.E.C. has defended the practice, saying that by settling with companies, it saves the commission the far greater expense - and potential risk - of fighting them in court. The agency says it is usually able to get as much money from a settlement as it could win in a protracted legal case, with money being returned to investors more quickly. In crafting a settlement of securities fraud charges, companies frequently seek the "neither admit nor deny" language for fear that admitting the conduct could then be used against them in shareholder lawsuits seeking damages.