The Wall Street Journal: SEC to change process for hiring in-house judges after legal challenge

WASHINGTON — A gambit by the Securities and Exchange Commission to bring more enforcement actions through its in-house courts has partly backfired.

The SEC said Thursday that it was changing the way it appoints in-house judges who hear some of its enforcement cases, one day after the Justice Department sided with opponents who say their hiring was unconstitutional.

The three-member commission said it directly approved the five judges’ appointments, instead of relying on a selection process managed by human-resources officials. The commission had previously maintained their hires were valid because the judges are employees, not officers who are subject to a constitutional clause that safeguards separation-of-powers principles.

The catalyst for the change is a legal challenge filed by Raymond Lucia, a California financial adviser who was accused of misleading investors and barred from the securities industry as punishment. Lucia has appealed to the U.S. Supreme Court, arguing the SEC judge who heard his case wasn’t appointed by the commission, as the Constitution requires. The Justice Department jolted the case on Wednesday when it told the Supreme Court that it now considers the SEC’s judges to be officers like other presidential appointees.

An expanded version of this report appears on WSJ.com.

Also popular on WSJ.com:

Six minutes to counterattack: South Korea shows plan to strike back at North’s missiles.

T. Boone Pickens lists longtime Texas ranch for $250 million.

Filed in: Top News Tags: 

You might like:

CryptoWatch: Crypto market cap hits 4-week high, but intraday volatility remains CryptoWatch: Crypto market cap hits 4-week high, but intraday volatility remains
Need to Know: Watch for ‘violent selloff’ to thwart Saudis’ wish for $100 oil Need to Know: Watch for ‘violent selloff’ to thwart Saudis’ wish for $100 oil
Young people apparently don’t realize these popular ‘crème brulée’ e-cigarettes contain nicotine Young people apparently don’t realize these popular ‘crème brulée’ e-cigarettes contain nicotine
Economic Report: Philly Fed manufacturing index points to continued growth in April Economic Report: Philly Fed manufacturing index points to continued growth in April
Bond Report: 10-year Treasury yield extends climb as earnings lift appetite for stocks Bond Report: 10-year Treasury yield extends climb as earnings lift appetite for stocks
Economic Report: Jobless claims fall slightly to 232,000 in late April Economic Report: Jobless claims fall slightly to 232,000 in late April
Currencies: Dollar searches for catalyst as risk sentiment improves Currencies: Dollar searches for catalyst as risk sentiment improves
America’s fastest-growing plastic surgery procedure takes place below the belt America’s fastest-growing plastic surgery procedure takes place below the belt

Leave a Reply

Submit Comment
© 2018 Stock Investors News. All rights reserved. XHTML / CSS Valid.