In 2010, I ran a multi-family office, employed 11 people, published articles on finance and campaigned for shareholder rights. I am now barred from practicing my profession.
The Securities and Exchange Commission wants you to believe I gambled my career and reputation in a scheme designed to overcharge my clients by $2,269, about $70 per month—possibly the smallest case the SEC has ever undertaken.
There was no trial or hearing. I never pleaded guilty or admitted breaking any laws. But the SEC was judge, jury and executioner. I accepted the SEC’s offer of a one-year suspension and should have returned to work three years ago. Yet, somehow, the agency decided I’m permanently barred. How? I don’t know. Why? It won’t show me the documents.
My experience may sound improbable. Originally, financial regulation did not work this way. But after the 2008 crisis, the SEC came under pressure to win cases and levy fines. A well-meaning Congress gave the SEC enormous powers: the power to make its own rules, enforce those rules against individuals as well as firms, and require that in-house judges try cases. The SEC has poured hundreds of billions of dollars in fines into the U.S. Treasury, including the fines it uses to fund itself. Big firms pay big money to avoid prosecution. Small firms are simply destroyed.
The SEC should return to its mission, vigorously enforcing the dissemination and disclosure of financial information based on honest accounting and making sure the markets run efficiently and smoothly. The SEC should once again enforce laws created by legislators and try cases in front of unbiased judges, bound by the principles of due process and equal protection.
I want to get my reputation back and return openness and fairness to a system that was once the envy of the world. If this can happen to me, it can happen to you. If you don’t care about me or the SEC, remember that many of the same laws apply to the IRS, the EPA, the Department of Labor and even Immigration.
Write a letter to the editor. Contact elected officials. Forward this website’s link to friends. Or just hit the follow button.
Read my story. Hopefully, you’ll want to get involved too.
Eric D. Wanger, The $2,200 Man