Constitutional thunder out of the fifth circuit

The rumble you hear in the distance are federal courts moving to re-establish the proper understanding of the constitutional separation of powers. The latest legal bomb is a ruling last week by the Fifth Court of Appeals (based in Louisiana) against the Securities and Exchange Commission.


The case involves hedge fund founder George Jarkesy and an investment adviser, and it depends on whether the constitution still protects the individual’s freedom. In 2013, the SEC accused the pair of securities fraud for allegedly inflating the value of the fund’s assets. The agency said the higher valuation allowed them to earn higher administration fees.

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