On June 23, the U.S. Supreme Court ruled that the SEC is limited in the amount of fine that it can impose to company profits from illegal activities.
Under the new restrictions, the U.S. Securities and Exchange Commission does not have the right to impose a fine exceeding the profits of the company's illegal activities. The fine should be imposed only in order to return the lost funds to the victims of fraud, and not with the aim of punishing the company. As the court stated: «the punishment must match the crime». In addition, the financial regulator has another limitation associated with the limitation period of the case - no more than five years.
The U.S. Supreme Court ruling applies to all companies, but given the fact that crypto companies often fall into the Commission's field of view, the established restrictions should be also applied to the crypto industry. Such restrictions are introduced in order to prevent any possibility of extortion, as well as establish a clear framework for imposing a fine.
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