Bioelectronics Corp (BIEL)

[srinsocal]

SEC has control over how Disgorgements are used

<<<<< The money recovered went back to shareholders, not into the SEC coffers >>>>> nice thought but not how things work


The original judgement against BIEL, the one SCOTUS voided, was:

$650k in Civil Penalties against St John's

$130k in Civil Penalties against A. Whelan

$1,82 million in disgorgement

The Civil Penalties and Disgorgements all go into a Treasury Fund. Investors who were harmed by fraudulent financial activity can petition for compensation . In 2019 the SEC had $3.2 billion in disgorgements, only 37% of that was used to compensate harmed investors.

Yale law Journal
"Despite the increase in the sums assessed, most of the money collected goes where it always has: to the U.S. Treasury General Fund. Compensating harmed investors was not historically an agency priority, but the Sarbanes-Oxley Act of 2002 (SOX) fundamentally shifted the SEC’s approach to distributing funds collected—at least nominally. Section 308 authorized the SEC to use penalty funds, in addition to disgorgements, to compensate harmed investors via Federal Account for Investor Restitution (Fair) Funds. The agency’s response has been seemingly enthusiastic, with multiple proclamations about its efforts on behalf of shareholders. However, based on an analysis of SEC data, this enthusiastic rhetoric does not reflect reality. Efforts to distribute funds to harmed investors have tapered off over time, such that the vast majority of sums collected are still deposited in Treasury’s General Fund. This ensures that the SEC contributes more revenue to the government than any other independent agency."

https://www.yalelawjournal.org/comment/sec-monetary-penalties-speak-very-loudly-but-what-do-they-say-a-critical-analysis-of-the-secs-new-enforcement-approach
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Congress controls the SEC budget. The SEC has a better chance of receiving larger budgets from Congress if their Statistics show high numbers of convictions and billions of $$$$$ deposited into the Treasury.