Media Coverage
Source: Global Investigations Review
Media Coverage
Press Contacts: Erik Cummins, Matt Hyams, Taina Rosa, Olivia Thomas
08.02.24
In a recent six-to-three ruling, the U.S. Supreme Court found that the Securities and Exchange Commission (SEC) lacks authority to seek civil penalties for fraud charges that are filed in the agency’s administrative courts.
In an interview with Global Investigations Review, Corporate Investigations & White Collar partner David Oliwenstein said that despite the limitation that the Court imposed on the SEC’s authority, the numbers show that the SEC’s enforcement efforts are unlikely to be hindered.
“I think we only need to look at the SEC’s enforcement stats over the last few years, which I think depict an incredibly aggressive and robust enforcement program,” Oliwenstein said. “That all has happened at a time when the SEC has already baked the [ruling] into the cake.”
Oliwenstein added that while the Court’s opinion was issued in the context of a fraud case, the ruling could be construed to apply to all SEC cases seeking civil penalties, which could spark the fall of its administrative courts.
“If [the ruling] only applies when [the SEC] charges fraud, then it’s somewhat constrained. If it applies whenever the SEC pursues penalties regardless of the charge, I think its implications are profound. They’d have to bring an overwhelming majority of enforcement actions in federal court where the staff doesn’t enjoy the home-field advantage,” he concluded.
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