SEC Writes Off $10 Billion in Fines It Can't Collect (msn.com)
- Reference: 0175813103
- News link: https://news.slashdot.org/story/25/01/01/168241/sec-writes-off-10-billion-in-fines-it-cant-collect
- Source link: https://www.msn.com/en-us/money/markets/sec-writes-off-10-billion-in-fines-it-can-t-collect/ar-AA1wMwpK
While the agency reported $4.9 billion in sanctions last year, it typically collects only two-thirds of imposed penalties. The SEC stopped disclosing collection rates in 2019. In fiscal 2024, it collected just 23% of $8.2 billion in reported sanctions, including a $4.4 billion judgment against cryptocurrency firm Terraform Labs that will likely go unpaid due to bankruptcy proceedings.
[1] https://www.msn.com/en-us/money/markets/sec-writes-off-10-billion-in-fines-it-can-t-collect/ar-AA1wMwpK
"take the money and run" (Score:2)
I would like to see some statistics on this, to sell where the money went. Did they just piss it away on bad risks and bad decisions and folded, or did the individuals/groups that set up the companies ride off into the sunset on massive cash-out bonuses and golden parachutes as the companies imploded?
(or did they have parasite consultants / suppliers that were rigged to massively overcharge to "launder out" money from the company, in a process similar to "hollywood accounting")
Re: (Score:2)
They put several crypto companies out of business with unpayable fines.
That was the play - collecting the money wasn't the goal. The crowd went wild at the recent fintech conference when Trump promised to fire Gensler.
These actions were all illegal under the Major Questions Test that SCOTUS has recently reinforced.
There are no "losses", just a trail of bodies.
Re: (Score:3)
"They put several crypto companies out of business with unpayable fines."
Like that's a bad thing. Won't anyone think of the organized criminals!
"That was the play - collecting the money wasn't the goal."
Right, as though the criminal justice system is inherently corrupt, and the people who commit crimes are innocent victims.
"The crowd went wild at the recent fintech conference when Trump promised to fire Gensler."
Yeah for organized crime, Trump's discovered your game and wants a piece!
"These actions were al
I don't understand "writes off" (Score:2)
That's usually a concept used in reporting profits and losses. Reporting law requires that entities honestly take debts owed but are likely not collectible off of their books and subtract it from profit.
The SEC has no profit and loss statement per se. Debts (fines) owed can stay on the books forever. The statistics would be interesting. How much money is slipping through their fingers and where? What can we do to tighten up the collection process?
Bankruptcy limitation (Score:2)
Is bankruptcy not limited to protecting you only from legal losses? If a business breaks the law to the point the SEC is looking to collect, then bankruptcy should mean the debt is transferred to the C-suite and majority stock holders, personally .
Re: Bankruptcy limitation (Score:2)
Like it or not, one of the points of corporations is to limit liability vs doing stuff personally.
Pierce the corporate veil (Score:2)
> Like it or not, one of the points of corporations is to limit liability vs doing stuff personally.
There's a concept of "piercing the corporate veil", which means that if you're not running your corporation in a serious manner the protections don't apply.
I've only heard this used when a small business owner doesn't have annual meetings, or doesn't do the annual meetings in a specific manner. Having dinner in a restaurant with the other owners is sufficient, but you have to take notes and have appropriate records &c. If you don't have a formal annual meeting, the IRS deems the corporation not being ru
Lines (Score:2)
When a company files for bankruptcy, their accounts are frozen and put under administration per a judge. Depending on what type of bankruptcy it is, creditors are arranged in priority to be paid off. First in line, under every contingency, is the government. If the company owes the government *any* money, they get paid first.