Plain-English summary
Court unanimously affirms SEC can seek disgorgement without proving investor pecuniary loss
The Court unanimously held the Securities and Exchange Commission does not need to prove investors suffered monetary losses before obtaining disgorgement in its civil enforcement actions under 15 U.S.C. §78u(d)(5) or §78u(d)(7). The Ninth Circuit’s decision in favor of the SEC was affirmed.
Why this matters
The decision preserves the SEC’s ability to recover profits from securities law violators even when no direct, measurable losses to investors can be shown. That affects how the SEC can deter fraud and return gains from wrongdoers to the government or harmed parties, and it influences the remedies available in many enforcement cases involving complex financial misconduct.
Who may feel it
- Securities and Exchange Commission (SEC) enforcement actions
- Individuals and firms accused of securities fraud
- Investors and consumers in securities markets
- Defense lawyers and compliance officers in financial firms
- Courts that handle SEC civil enforcement cases