Statutes of Limitations and Unanswered Questions in the New SEC Disgorgement Statute
11 Pages Posted: 20 Sep 2022
Date Written: September 7, 2022
Abstract
Congress enacted a new disgorgement statute and limitations periods for enforcement cases brought by the Securities and Exchange Commission. A major and remarkable consequence of the statute is that a limitations period now governs most types of SEC enforcement cases. That is a significant reversal of the law as it stood since the Securities Act of 1933.
A further but unfortunate consequence of the new statute is that it has gaps and inconsistencies. It creates a series of questions about its application, the definition of disgorgement, and the limitations periods. Courts could face any of these questions when deciding an SEC enforcement case, and the SEC and defense lawyers could face them while litigating or negotiating a settlement.
This paper addresses both topics. It describes the broad coverage of the new limitations periods, and it outlines many unanswered questions created by the new statute.
Keywords: limitations, disgorgement, statute of limitations, SEC, enforcement, Liu, Kokesh
JEL Classification: K22, K23
Suggested Citation: Suggested Citation