SEC Breach Gives Firepower To Critics Of In-House Courts

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By Al Barbarino (April 8, 2022, 5:54 PM EDT) — The U.S. Securities and Exchange Commission’s adjudication system was already under heavy fire when the agency unexpectedly revealed an internal information breach, but it may have given critics more ammunition to challenge the constitutionality of the agency’s in-house courts. 

According to an SEC announcement Tuesday, the agency has uncovered that, in 2017, members of administrative staff in its enforcement unit accessed adjudicatory materials and memos for cases being litigated in its in-house court system.

The agency called it a “control deficiency related to the separation of its enforcement and adjudicatory functions within its system for administrative adjudications.” 

An ongoing review has…

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