Supreme Court Upholds SEC's Power to Retrieve Ill-Gotten Gains

The U.S. Supreme Court unanimously upheld the SEC's authority to recover illegal profits via disgorgement, a key enforcement tool. This decision, supporting a $3 million order against Ongkaruck Sripetch, emphasizes that showing financial harm isn't necessary for victim compensation. The SEC secured $6.1 billion through disgorgement in fiscal 2025.

The U.S. Supreme Court has reinforced the Securities and Exchange Commission's (SEC) key enforcement ability to recover illicit profits through a remedy known as disgorgement. In a unanimous 9-0 decision, the court ruled against a challenge to this power, strengthening the agency's hand in financial fraud cases.

The case revolved around Ongkaruck Sripetch, who was ordered to return over $3 million gained illegitimately. Sripetch questioned the requirement for evidence of investor harm before such a repayment could be demanded. However, the court stated that showing pecuniary loss is not necessary for identifying an investor as a victim deserving compensation.

Historically key to the SEC, disgorgement secured $1.4 billion under Trump's leadership and rose to $6.1 billion under Biden. Beyond disgorgement, the SEC can also impose fines and sanctions. This ruling underscores the agency's broad enforcement powers despite ongoing legal challenges.