SEC Power to Recoup Illegal Profits Curbed by U.S. Supreme Court

SEC Power to Recoup Illegal Profits Curbed by U.S. Supreme Court

In early June, a unanimous Supreme Court handed down its ruling on whether “disgorgement,” or the repayment of ill-gotten gains, is subject to a statute of limitations. The court ruled that it is, and this has broad implications for any person or organization investigated by the Securities and Exchange Commission, experts say. “This will be more advantageous to all proposed SEC defendants, including Wall Street,” says Marc Powers, leader of BakerHostetler‘s securities litigation and regulatory enforcement practice and its hedge fund industry practice. “They will be able to sleep at night, not fearing the SEC and forever looking over their shoulders for their questionable conduct in the securities markets.” Here’s what you need to know about the ruling. The Case Charles Kokesh was found to have misappropriated funds from four investment companies. He was ordered to pay a civil penalty and disgorgement, dating back to 1995. Kokesh argued that the …

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