Earlier today, Cato sued the Securities and Exchange Commission in federal court challenging the SEC's policy of imposing perpetual gag orders on settling defendants in civil enforcement actions.
The clear point of that policy is to prevent people with the best understanding of how the SEC uses its vast enforcement powers from sharing that knowledge with others.
The author now wants to tell his side of the story, and Cato wants to publish it as a book-but both are prevented from doing so by a provision in the SEC settlement agreement that forbids the author from "Mak[ing] any public statement denying, directly or indirectly, any allegation in the [SEC's] complaint or creating the impression that the complaint is without factual basis." This provision appears to be standard not only in SEC settlements, but with the CFTC, the CFPB, and possibly other regulatory agencies as well.
Today 97 percent of federal criminal convictions are obtained through plea bargains, and a similar percentage of SEC civil enforcement actions are settled instead of adjudicated.
Perpetual gag orders like the ones routinely imposed by the SEC, CFTC, and CFPB as a condition of settlement are utterly antithetical to principles of good government and, not coincidentally, to the First Amendment's protections of free speech and a free press as well.
Accordingly, we at Cato have teamed up with our friends at the Institute for Justice, which represents Cato in its challenge to the SEC's unconstitutional policy of demanding perpetual gag orders as a condition of settlement in civil enforcement actions.
Together, we aim to strike down not only the specific gag order at issue in this case, but all perpetual gag orders in all existing civil settlements with federal agencies-and to terminate the government's policy of silencing those whom it accuses of wrongdoing.
https://www.cato.org/blog/cato-sues-sec-over-gag-orders
The clear point of that policy is to prevent people with the best understanding of how the SEC uses its vast enforcement powers from sharing that knowledge with others.
The author now wants to tell his side of the story, and Cato wants to publish it as a book-but both are prevented from doing so by a provision in the SEC settlement agreement that forbids the author from "Mak[ing] any public statement denying, directly or indirectly, any allegation in the [SEC's] complaint or creating the impression that the complaint is without factual basis." This provision appears to be standard not only in SEC settlements, but with the CFTC, the CFPB, and possibly other regulatory agencies as well.
Today 97 percent of federal criminal convictions are obtained through plea bargains, and a similar percentage of SEC civil enforcement actions are settled instead of adjudicated.
Perpetual gag orders like the ones routinely imposed by the SEC, CFTC, and CFPB as a condition of settlement are utterly antithetical to principles of good government and, not coincidentally, to the First Amendment's protections of free speech and a free press as well.
Accordingly, we at Cato have teamed up with our friends at the Institute for Justice, which represents Cato in its challenge to the SEC's unconstitutional policy of demanding perpetual gag orders as a condition of settlement in civil enforcement actions.
Together, we aim to strike down not only the specific gag order at issue in this case, but all perpetual gag orders in all existing civil settlements with federal agencies-and to terminate the government's policy of silencing those whom it accuses of wrongdoing.
https://www.cato.org/blog/cato-sues-sec-over-gag-orders
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