SEC Guidance on In-House Tribunals Raises More Questions than Answers

In an attempt to quell growing controversy over the practice, the SEC released public Guidance on its procedures for deciding whether an enforcement action should be brought before the SEC’s in-house administrative law tribunals instead of a federal court. The SEC’s increasing use of internal tribunals has spawned concerns about the lack of due process in a proceeding entirely controlled by the SEC. However, as the New York Times points out today, the Guidance does little to assuage concerns. In fact, it shows that the SEC may be using the tribunals to shape securities law in the direction it wants—with little oversight from the courts.

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