The Supreme Court has untied disgorgement from victim harm. Does this effectively turn the SEC's remedy into a penalty?
With the SEC's power to seize illicit profits now stronger than ever, will defrauded investors actually get their money back?
Landmark 2026 Supreme Court Ruling: SEC Can Seek Disgorgement Without Investor Harm, Resolving Circuit Split
Overview
The Supreme Court’s unanimous decision in Sripetch v. SEC resolved a major legal debate about the SEC’s power to recover ill-gotten gains. The case began when Ongkaruck Sripetch was accused of a $6 million pump-and-dump scheme, leading him to ask the Court to address confusion over whether the SEC must prove direct investor harm to seek disgorgement. Recognizing the need for clarity, the Court agreed to hear the case and ultimately ruled that the SEC does not need to show specific harm to investors before requiring wrongdoers to surrender illicit profits, strengthening the SEC’s enforcement authority.