The conservative justices on the U.S. Supreme Court have expressed skepticism of the Securities and Exchange Commission’s use of its own administrative tribunals to pursue civil actions against people accused of securities violations. The justices are concerned that these tribunals provide people accused of violating securities laws with an unfair lack of due process. The court is currently hearing arguments on whether the SEC’s use of its own tribunals is constitutional. Justice Brett Kavanaugh, when speaking to the Solicitor General, leading the argument in support of the SEC, suggested that the SEC’s use of in-house tribunals “did not look or smell constitutional.” Justice Samuel Alito also asked whether the SEC was engaging in “judge-shopping” by picking an in-house tribunal that was more likely to rule in its favor. The other three conservative justices on the court expressed similar concerns. This suggests that the Supreme Court is likely to side against the SEC in this case.
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