Government's Silent Legal Battle Expands Control Over Traders

The U.S. Securities and Exchange Commission (SEC) is quietly using lawsuits to expand its regulatory reach and reshape rules governing who needs to register as a securities dealer. The SEC's recent interpretation of the definition of a dealer has led to lawsuits against traders who were previously not required to register. The agency's campaign has raised concerns that it could make trading more difficult for individuals and firms, and even impact trading in Treasuries. Critics argue that the SEC is bypassing Congress and establishing new procedures through the courts, potentially creating a new legal order.