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The Securities and Exchange Commission is increasingly steering cases to hearings in front of the agency’s appointed administrative judges, who found in its favor in every verdict for the 12 months through September, rather than taking them to federal court.
The winning streak comes amid a marked shift at the agency toward trying cases that are more complex before its administrative law judges. Historically, the SEC had more often turned to these judges for relatively straightforward legal actions, such as barring stockbrokers who had been convicted of criminal fraud. Thanks in part to enhanced powers granted in the 2010 Dodd-Frank financial-reform bill, the SEC lately has been using the administrative judges for complicated cases, including several involving insider trading.
“It’s fair to say it’s the new normal,” Kara Brockmeyer, head of the SEC’s anti-foreign-corruption enforcement unit, told a legal conference in Washington last week. “Just like the rest of the enforcement division, we’re moving towards using administrative proceedings more frequently.”
Source: The Wall Street Journal
