“We are concerned that the SEC is damaging the perceived legitimacy of how the agency uses its enforcement power,” write William McClucas, former director of the SEC’s Division of Enforcement, and Matthew Martens, the SEC’s former chief litigation counsel, in the Wall Street Journal.
Criticizing the SEC’s use of in-house administrative courts, the authors suggest the SEC should “develop meaningful criteria for exercising its discretion to bring matters in-house.” Further, the SEC should modernize the “rules of procedure governing its in-house proceedings” and “avoid finding, on appeal, additional violations and imposing additional penalties beyond those assessed” by the SEC’s administrative law judges.
“The SEC’s approach to administrative proceedings leaves something to be desired. It isn’t too late to fix that,” conclude the authors.
Read the full op-ed here.