The top U.S. securities regulator yesterday tried to respond to complaints that the deck is stacked against defendants at in-house trials by approving the first major revisions to its administrative proceedings in two decades, Reuters reported yesterday. But the changes by the Securities and Exchange Commission may not silence critics. The 13 comment letters it received after proposing the revisions last September all sent the same message: They do not go far enough. The final version, approved unanimously by the three-member commission without debate, did make minor changes. Still, it will not likely appease those who say the trials deny constitutional protections to defendants. "While I appreciate the SEC acknowledging the serious due process concerns that have been raised because of their unfair use of in-house judges, the changes adopted today effectively put a Band-Aid on a wound that requires stitches," said Rep. Scott Garrett (R-N.J.), who sponsored legislation to push more cases into federal courts. "This is an extremely modest step in the right direction, but defendants ultimately deserve a right to remove themselves from the SEC's tribunals so they can have their case heard in federal court." The 2010 Dodd-Frank Wall Street reform law allowed the SEC to pursue cases against a wider universe of defendants before its in-house judges in what are called administrative proceedings. That raised the ire of defense lawyers, who say the SEC has an outsized advantage in the proceedings.
