The US Supreme Court limited the powers of the SEC: what does this mean for the business community
Date: 2024-06-28 Author: Henry Casey Categories: IN WORLD
The US Supreme Court made a decision that dealt a serious blow to the powers of the Securities and Exchange Commission (SEC). This decision has far-reaching implications for administrative processes related to financial regulation in the country.
Limitation of SEC powers
The court stripped the SEC of its ability to use its own internal judges in administrative cases. This has previously drawn public criticism, especially from high-profile entrepreneurs such as Elon Musk and Mark Cuban.
Particular attention was drawn to the case of George Jarkesy Jr., who was charged with fraud by the SEC and ordered to pay a fine. The trial was conducted before a domestic judge under the Dodd-Frank Act, but the defendant himself argued that his constitutional rights were violated, including the right to a trial before a federal jury.
Appeal from the US Department of Justice
In response to the Supreme Court's decision, the US Department of Justice filed a petition for reconsideration in favor of preserving the SEC's powers. They expressed concerns that the decision could weaken the powers of the executive branch in general and the SEC in particular.
Business leaders and companies backed the Supreme Court's decision, arguing that the SEC's use of internal judges gives the regulator an undue advantage in litigation.
Now the SEC will be forced to rely on decisions of federal courts in administrative cases related to violations of securities laws and fines. The Supreme Court's decision is acknowledged by defenders of the constitutional rights of the accused, but raises concerns about the future of the US financial regulatory process.
