Finra, SEC Face New Attack on Enforcement Power Under Jarkesy

The SEC and a private financial industry regulator both lacked the authority to impose sanctions in a case seeking civil penalties, a targeted financial consultant told the Sixth Circuit.

The appeals court should set aside a Securities and Exchange Commission order sustaining the Financial Industry Regulatory Authority’s decision to impose a securities industry ban and $130,000 in restitution, consulting firm owner Eric Smith said Wednesday. The Constitution requires Smith’s case to be heard in a judicial branch court under the US Supreme Court’s decision in SEC v. Jarkesy, he told the US Court of Appeals for the Sixth Circuit. ...