SEC Power to Recoup Illegal Gains Gets Review From Supreme Court

The US Supreme Court will consider how much power the Securities and Exchange Commission has to recover illegal profits in a case that could blunt one of the agency’s most potent enforcement tools.

The justices said Friday they will decide whether the SEC must show identifiable investor harm in order to win “disgorgement” from people and firms found to have engaged in securities fraud.

The case concerns what has traditionally been one of the Wall Street watchdog’s favorite legal remedies. The commission secured orders for more than $6 billion in disgorgement and related interest in fiscal 2024, almost three-quarters of ...