Supreme Court Case Could ‘Radically Alter’ SEC Enforcement
Securities Enforcement Defense attorney Scott Mascianica was quoted in an Agenda article about the Securities and Exchange Commission (SEC)’s halted use of in-house judges in a Supreme Court case that could cause problems across federal agencies and clog up courthouses throughout the country. The Supreme Court will hear oral arguments in the Jarkesy v. SEC case that challenges the constitutionality of the SEC’s administrative law judges. Mr. Mascianica discussed the impact that this case may have on how the SEC approaches ongoing enforcement efforts.
The ruling caused the SEC to remand all pending administrative law cases at the time for new hearings before judges appointed in line with the Constitution. After that, the SEC’s Division of Enforcement “pulled back from filing contested cases before ALJs,” said Mr. Mascianica. The commission continues to bring settled orders before its administrative judges, he added.
If that ends up being the case, congressional action could ultimately provide relief to the SEC if a law is passed modifying the removal restrictions for administrative law judges, Mr. Mascianica stated.
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