The Supreme Court’s 2017 ruling in Kokesh v. SEC severely hampered the SEC’s ability to force bad actors in the financial services industry to pay injured parties. To date, the Kokesh ruling has allowed criminals to keep $1 billion or more in ill-gotten gains; this is unconscionable, and needs to be fixed. Extending the statute of limitations for disgorgement is reasonable given that certain financial crimes, such as Ponzi-type schemes, are difficult to detect and legally intensive to investigate and prosecute (all of which increases the length of time needed to prosecute them).
The Supreme Court’s 2017 ruling in Kokesh vs. SEC was appropriate given the finding that the SEC has historically used disgorgement to punish securities fraud perpetrators, rather than to make defrauded investors whole — and punishment isn’t part of the SEC’s mission. Additionally, given that the Supreme Court will take up a case concerning disgorgement itself in Spring 2020, this bill could become a moot point in a matter of months; so it’d be better to wait until SEC v. Liu is decided next year before considering this bill.