Justices Seem Likely to Reinforce U.S. Securities-Fraud Laws (1)

U.S. Supreme Court justices seemed likely to reinforce the Securities and Exchange Commission’s powers, hearing the case Dec. 3 of an investment banker accused of duping investors about a startup company’s financial condition.

The banker, Francis V. Lorenzo, says the SEC didn’t have enough proof to hold him liable for taking part in a scheme to defraud investors.

But conservative Justice Samuel Alito suggested during arguments in Washington that Lorenzo’s conduct fell “squarely within” the broad language of the federal securities laws. And a potential swing justice, Stephen Breyer, said Lorenzo was a “big-deal participant” in the effort to deceive ...