A new client this week wanted help to deal with a money judgment against him in favor of the U.S. Securities and Exchange Commission. The client’s main assets were a Florida homestead and a company pension. He is a salaried employee and supports his spouse and children.
SEC judgments other than disgorgement are treated as ordinary debts. The debtor may exempt from recovery by the SEC of assets which the debtor may exempt under applicable state laws. Disgorgement is an equitable remedy, and the SEC has available extraordinary remedies to seize the debtor’s property to enforce disgorgement orders. A court could hold a debtor in contempt for failure to turn over assets to comply with a disgorgement judgment.
I do not believe the SEC could force the sale of a debtor’s Florida homestead, but the SEC could probably place a lien on the property to recover money when the property is sold or refinanced. Employee pensions and most other retirement is exempt from disgorgement. Other assets are vulnerable. For instance, the SEC can hold debtor’s in contempt for refusal to turn over money held in offshore accounts or offshore entities.
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