Registration as Consent: Patching Jarkesy's Hole in SEC Enforcement

Alexander I. Platt*

In SEC v. Jarkesy, the Supreme Court held that whenever the SEC seeks to impose monetary penalties on enforcement targets for securities fraud, it must proceed in federal court and not its own administrative forum.  Many observers predict this will significantly impact SEC enforcement.

But not necessarily.  A simple legal patch might repair the hole Jarkesy opened up: parties who register with the SEC may thereby consent to its administrative jurisdiction.  (Because Jarkesy and the funds he managed were not registered, his case did not resolve the issue.)

This Essay shows how registration may constitute consent to SEC administrative adjudication.  Drawing on Supreme Court precedent on consent to otherwise unconstitutional adjudications, I show how SEC registrants either already have consented to SEC administrative adjudication or could easily be deemed to have done so by issuing new interpretive guidance or amending a few regulatory forms.

If accepted, this constitutional consent argument would substantially insulate SEC enforcement from Jarkesy’s impact.  I review all 1,481 actions the SEC brought in fiscal years 2021 and 2023 and find that only five percent of original enforcement actions involved administrative proceedings against unregistered parties for fraud-related misconduct seeking monetary penalties.  Limiting Jarkesy to unregistered persons would allow SEC enforcement to proceed virtually unchanged.

© 2025 Alexander I. Platt.  Individuals and nonprofit institutions may reproduce and distribute copies of this Essay in any format at or below cost, for educational purposes, so long as each copy identifies the author, provides a citation to the Notre Dame Law Review Reflection, and includes this provision in the copyright notice.

The Notre Dame Law Review has not independently reviewed the data and analyses described in this Article.

*Associate Professor, University of Kansas School of Law.  For helpful suggestions, I thank Chris Drahozal, Laura Hines, Andrew Jennings, Guha Krishnamurthi, Rick Levy, Geeyoung Min, Todd Phillips, Peter Salib, Tom Stacy, Emily Strauss, James Tierney, Kyle Velte, Steve Ware, Corey Rayburn Yung, David Zaring, and commentators at the Nebraska College of Law Faculty Workshop.