1 (Slip Opinion) OCTOBER TERM, 2016

Syllabus

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is being done in connection with this case, at the time the opinion is issued. The syllabus constitutes no part of the opinion of the Court but has been prepared by the Reporter of Decisions for the convenience of the reader. See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.


## SUPREME COURT OF THE UNITED STATES

Syllabus

KOKESH v . SECURITIES AND EXCHANGE
COMMISSION

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE TENTH CIRCUIT

No. 16–529. Argued April 18, 2017—Decided June 5, 2017

The Securities and Exchange Co mmission (SEC or Commission) pos

sesses authority to investigate violations of federal securities laws
and to commence enforcement actions in federal district court if its investigations uncover evidence of wrongdoing. Initially, the Com

mission’s statutory authority in enforcement actions was limited to seeking an injunction barring future violations. Beginning in the 1970’s, federal district courts, at the request of the Commission, be

gan ordering disgorgement in S EC enforcement proceedings. Alt

hough Congress has since authorized the Commission to seek mone

tary civil penalties, the Commission has continued to seek disgorgement. This Court has held that 28 U. S. C. §2462, which es

tablishes a 5-year limitations period for “an action, suit or proceeding for the enforcement of any civil fine , penalty, or forfeiture,” applies
when the Commission seeks mone tary civil penalties. See Gabelli v. SEC , 568 U. S. 442, 454. In 2009, the Commissi on brought an enforceme nt action, alleging

that petitioner Charles Kokesh violated various securities laws byconcealing the misappropriation of $34.9 million from four businessdevelopment companies from 1995 to 2009. The Commission sought monetary civil penalties, disgorge ment, and an injunction barring Kokesh from future violations. After a jury found that Kokesh’s ac

tions violated several securities la ws, the District Court determined that §2462’s 5-year limitations period applied to the monetary civil penalties. With respect to the $34.9 million disgorgement judgment, however, the court concluded that §2462 did not apply because dis

gorgement is not a “penalty” within the meaning of the statute. The Tenth Circuit affirmed, holding th at disgorgement was neither a2 KOKESH v. SEC

Syllabus

penalty nor a forfeiture.

Held : Because SEC disgorgement operates as a penalty under §2462,

any claim for disgorgement in an SEC enforcement action must be commenced within five years of the date the claim accrued. Pp. 5–11.

(a) The definition of “penalty” as a “punishment, whether corporal or pecuniary, imposed and enforced by the State, for a crime or offen[s]e against its laws,” Huntington v. Attrill , 146 U. S. 657, 667, gives rise to two principles. Firs t, whether a sanction represents a penalty turns in part on “whether the wrong sought to be redressed is a wrong to the public, or a wrong to the individual.” Id. , at 668. Sec

ond, a pecuniary sanction operates as a penalty if it is sought “for the purpose of punishment, and to dete r others from offending in like manner” rather than to compensate victims. Ibid. This Court has applied these principles in construi ng the term “penalty,” holding,

e.g. , that a statute providing a compensatory remedy for a private wrong did not impose a “penalty,” Brady v. Daly , 175 U. S. 148, 154. Pp. 5–7.

(b) The application of these prin ciples here readily demonstrates that SEC disgorgement constitutes a penalty within the meaning of §2462. First, SEC disgorgement is imposed by the courts as a conse

quence for violating public laws, i.e. , a violation committed against the United States rather than an aggrieved individual. Second, SEC disgorgement is imposed for puniti ve purposes. Sanctions imposed for the purpose of deterring infracti ons of public laws are inherently punitive because “deterrence [is] not [a] legitimate nonpunitive gov

ernmental objectiv[e].” Bell v. Wolfish , 441 U. S. 520, 539, n. 20. Fi

nally, SEC disgorgement is often no t compensatory. Disgorged prof

its are paid to the district courts, which have discretion to determine how the money will be distributed. They may distribute the funds to victims, but no statute commands them to do so. When an individual is made to pay a noncompensatory sanction to the government as a consequence of a legal violation, th e payment operates as a penalty.
See Porter v. Warner Holding Co. , 328 U. S. 395, 402. Pp. 7–9. (c) The Government responds that SEC disgorgement is not puni

tive but a remedial sanction that op erates to restore the status quo. It is not clear, however, that disgorgement simply returns the de

fendant to the place he would have occupied had he not broken the law. It sometimes exceeds the profit s gained as a result of the viola

tion. And, as demonstrated here, SEC disgorgement may be ordered
without consideration of a defend ant’s expenses that reduced the amount of illegal profit. In such cases, disgorgement does not simply restore the status quo; it leaves the defendant worse off and is there

fore punitive. Although disgorgement may serve compensatory goals in some cases, “sanctions frequent ly serve more than one purpose.”3 Cite as: 581 U. S. ____ (2017)

Syllabus

Austin v. United States , 509 U. S. 602, 610. Because they “go beyond compensation, are intended to p unish, and label defendants wrong

doers” as a consequence of violating public laws, Gabelli , 568 U. S., at 451–452, disgorgement orders represent a penalty and fall within §2462’s 5-year limitations period. Pp. 9–11.

834 F. 3d 1158, reversed.

S OTOMAYOR

, J., delivered the opinion fo r a unanimous Court._________________

_________________ 1 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

NOTICE: This opinion is subject to formal revision before publication in the preliminary print of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Wash

ington, D. C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.


## SUPREME COURT OF THE UNITED STATES

No. 16–529

CHARLES R. KOKESH, PETITIONER v. SECURITIES
AND EXCHANGE COMMISSION

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE TENTH CIRCUIT

[June 5, 2017]

J USTICE S OTOMAYOR delivered the opinion of the Court.
A 5-year statute of limitatio ns applies to any “action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise.” 28 U. S. C. §2462. This case presents the question whether §2462 applies to claims for disgorge ment imposed as a sanction for violating a federal securities law. The Court holds that it does. Disgorgement in the securities-enforcement con

text is a “penalty” within the meaning of §2462, and so disgorgement actions must be commenced within five years of the date the claim accrues.

I
A
After rampant abuses in the securities industry led to the 1929 stock market crash and the Great Depression, Congress enacted a series of laws to ensure that “the highest ethical standards prevail in every facet of the securities industry.” 1 SEC v. Capital Gains Research

——————

1 Each of these statutes—the Securities Act of 1933, 15 U. S. C. §77a

et seq .; the Securities Exch ange Act of 1934, 15 U. S. C. §78a et seq .; the2 KOKESH v. SEC

Opinion of the Court

Bureau, Inc. , 375 U. S. 180, 186–187 (1963) (internal quotation marks omitted). The second in the series—the Securities Exchange Act of 1934—established the Securi

ties and Exchange Commission (SEC or Commission) to enforce federal securities laws. Congress granted the Com

mission power to prescribe “ ‘rules and regulations . . . as necessary or appropriate in th e public interest or for the protection of investors.’ ” Blue Chip Stamps v. Manor Drug Stores , 421 U. S. 723, 728 (1975). In addition to rulemaking, Congress vested the Commission with “broad authority to conduct investigations into possible violations
of the federal securities laws.” SEC v. Jerry T. O’Brien,

Inc. , 467 U. S. 735, 741 (1984). If an investigation uncov

ers evidence of wrongdoing, the Commission may initiate
enforcement actions in federal district court. Initially, the only statutory remedy available to the SEC in an enforcement action was an injunction barring future violations of securities laws. See 1 T. Hazen, Law of Secu

rities Regulation §1:37 (7th ed., rev. 2016). In the absence of statutory authorization for monetary remedies, the Commission urged courts to order disgorgement as an
exercise of their “inherent equity power to grant relief ancillary to an injunction.” SEC v. Texas Gulf Sulphur
Co. , 312 F. Supp. 77, 91 (SDNY 1970), aff ’d in part and rev’d in part, 446 F. 2d 1301 (CA2 1971). Generally, dis

gorgement is a form of “[r]estitution measured by the defendant’s wrongful gain.” Restatement (Third) of Resti

tution and Unjust Enrichment §51, Comment a , p. 204

—————— Public Utility Holding Company Act of 1935, 15 U. S. C. §79 et seq .; the Trust Indenture Act of 1939, 15 U. S. C. §77aaa et seq .; the Investment Company Act of 1940, 15 U. S. C. §80a–1 et seq .; and the Investment Advisers Act of 1940, 15 U. S. C. §80b–1 et seq .—serves the “fundamen

tal purpose” of “substitut[ing] a ph ilosophy of full disclosure for the philosophy of caveat emptor and thus . . . achiev[ing] a high standard of business ethics in the securities industry.” SEC v. Capital Gains Research Bureau, Inc. , 375 U. S. 180, 186 (1963).3 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

(2010) (Restatement (Third)). Disgorgement requires thatthe defendant give up “those gains . . . properly attributable to the defendant’s interference with the claimant’s legally protected rights.” Ibid . Beginning in the 1970’s, courts ordered disgorgement in SEC enforcement proceed

ings in order to “deprive . . . defendants of their profits in order to remove any monetary reward for violating” secu

rities laws and to “protect the investing public by provid

ing an effective deterrent to future violations.” Texas Gulf , 312 F. Supp., at 92. In 1990, as part of the Securities Enforcement Remedies and Penny Stock Reform Ac t, Congress authorized the Commission to seek monetary civil penalties. 104 Stat. 932, codified at 15 U. S. C. §77t(d). The Act left the Com

mission with a full panoply of enforcement tools: It may promulgate rules, investigate violations of those rules and the securities laws generally, and seek monetary penal

ties and injunctive relief for those violations. In the years since the Act, however, the Commission has con

tinued its practice of seeking disgorgement in enforcement proceedings. This Court has already held that the 5-year statute of limitations set forth in 28 U. S. C. §2462 applies when the Commission seeks statutory monetary penalties. See
Gabelli v. SEC , 568 U. S. 442, 454 (2013). The question here is whether §2462, which applies to any “action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise,” also applies when the SEC seeks disgorgement.

B

Charles Kokesh owned two investment-adviser firms that provided investment advice to business-development companies. In late 2009, the Commission commenced an
enforcement action in Federal District Court alleging that between 1995 and 2009, Kokesh, through his firms, mis

-4 KOKESH v. SEC

Opinion of the Court

appropriated $34.9 million from four of those development companies. The Commission further alleged that, in order to conceal the misappropriation, Kokesh caused the filing of false and misleading SEC reports and proxy statements. The Commission sought civil monetary penalties, dis

gorgement, and an injunction barring Kokesh from violat

ing securities laws in the future. After a 5-day trial, a jury found that Kokesh’s actions violated the Investment Company Act of 1940, 15 U. S. C. §80a–36; the Investment Advisers Act of 1940, 15 U. S. C. §§80b–5, 80b–6; and the Securities Exchange Act of 1934, 15 U. S. C. §§78m, 78n. The District Court then turned to the task of imposing penalties sought by the Commission. As to the civil monetary penalties, the District Courtdetermined that §2462’s 5-year limitations period precluded any penalties for misappropriation occurring prior to October 27, 2004—that is, five years prior to the date the Commission filed the complaint. App. to Pet. for Cert.
26a. The court ordered Kokesh to pay a civil penalty of $2,354,593, which represented “the amount of funds that [Kokesh] himself received during the limitations period.”
Id. , at 31a–32a. Regarding the Commission’s request for a $34.9 million disgorgement judgment—$29.9 million of
which resulted from violations outside the limitations period—the court agreed with the Commission that be

cause disgorgement is not a “penalty” within the meaning of §2462, no limitations period applied. The court there

fore entered a disgorgement judgment in the amount of $34.9 million and ordered Kokesh to pay an additional $18.1 million in prejudgment interest. The Court of Appeals for the Tenth Circuit affirmed. 834 F. 3d 1158 (2016). It agreed with the District Court that disgorgement is not a penalty, and further found that disgorgement is not a forfeiture. Id ., at 1164–1167. The
court thus concluded that th e statute of limitations in §2462 does not apply to SEC disgorgement claims.5 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

This Court granted certiorari, 580 U. S. ___ (2017), to resolve disagreement among the Circuits over whether disgorgement claims in SEC proceedings are subject to the 5-year limitations period of §2462. 2

II
Statutes of limitations “se[t] a fixed date when exposure to the specified Government enforcement efforts en[d].”
Gabelli , 568 U. S., at 448. Such limits are “ ‘vital to the welfare of society’ ” and rest on the principle that “ ‘even wrongdoers are entitled to assume that their sins may be forgotten.’ ” Id., at 449. The statute of limitations at issue here—28 U. S. C. §2462—finds its roots in a law enacted nearly two centuries ago. 568 U. S., at 445. In its current form, §2462 establishes a 5-year limitations period for “an action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture.” This limitations period ap

plies here if SEC disgorgement qualifies as either a fine, penalty, or forfeiture. We hold that SEC disgorgement constitutes a penalty. 3

A
A “penalty” is a “punishment, whether corporal or pecu

niary, imposed and enforced by the State, for a crime or offen[s]e against its laws.” Huntington v. Attrill , 146 U. S. 657, 667 (1892). This definition gives rise to two princi

ples. First, whether a sanction represents a penalty turns

——————

2 Compare SEC v. Graham , 823 F. 3d 1357, 1363 (CA11 2016) (hold

ing that §2462 applies to SEC disgorgement claims), with Riordan v. SEC , 627 F. 3d 1230, 1234 (CADC 2010) (holding that §2462 does not apply to SEC disgorgement claims).

3 Nothing in this opinion should be interpreted as an opinion on whether courts possess authority to order disgorgement in SEC en

forcement proceedings or on whethe r courts have properly applied disgorgement principles in this cont ext The sole question presented in this case is whether disgorgement, as applied in SEC enforcement actions, is subject to §2462’s limitations period.6 KOKESH v. SEC

Opinion of the Court

in part on “whether the wrong sought to be redressed is a wrong to the public, or a wr ong to the individual.” Id ., at

668. Although statutes creating private causes of action against wrongdoers may appear—or even be labeled— penal, in many cases “neither the liability imposed nor the remedy given is strictly penal.” Id ., at 667. This is be

cause “[p]enal laws, strictly and properly, are those impos

ing punishment for an offense committed against the
State.” Ibid. Second, a pecuniary sanction operates as a penalty only if it is sought “for the purpose of punishment, and to deter others from offending in like manner”—as opposed to compensating a victim for his loss. Id ., at 668. The Court has applied these principles in construing the term “penalty.” In Brady v. Daly , 175 U. S. 148 (1899), for example, a playwright sued a defendant in Federal Circuit Court under a statute providing that copyright infringers

“ ‘shall be liable for damages . . . not less than one hundred dollars for the first [act of infringement], and fifty dollars for every subsequent perform ance, as to the court shall appear to be just.’ ” Id., at 153. The defendant argued that the Circuit Court lacked jurisdiction on the ground that a separate statute vested district courts with exclu

sive jurisdiction over acti ons “to recover a penalty.” Id ., at

152. To determine whether the statutory damages repre

sented a penalty, this Court noted first that the statute provided “for a recovery of damages for an act which vio

lates the rights of the plaintiff, and gives the right of action solely to him” rather than the public generally, and second, that “the whole recovery is given to the proprietor, and the statute does not provide for a recovery by any other person.” Id ., at 154, 156. By providing a compensa

tory remedy for a private wrong, the Court held, the stat

ute did not impose a “penalty.” Id., at 154. Similarly, in construing the statutory ancestor of §2462, the Court utilized the same principles. In Meeker v. Lehigh Valley R. Co. , 236 U. S. 412, 421–422 (1915), the7 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

Interstate Commerce Commissi on, a now-defunct federal agency charged with regulating railroads, ordered a rail

road company to refund and pay damages to a shipping company for excessive shipping rates. The railroad com

pany argued that the action was barred by Rev. Stat. §1047, Comp. Stat. 1913, §1712 (now 28 U. S. C. §2462), which imposed a 5-year limitations period upon any “ ‘suit or prosecution for a penalty or forfeiture, pecuniary or otherwise, accruing under the laws of the United States.’ ” 236 U. S., at 423. The Court rejected that argument, reasoning that “the words ‘penalty or forfeiture’ in [the statute] refer to something im posed in a punitive way for an infraction of a public law.” Ibid . A penalty, the Court held, does “not include a liability imposed [solely] for the purpose of redressing a private injury.” Ibid . Because the liability imposed was compensatory and paid entirely to a private plaintiff, it was not a “penalty” within the meaning
of the statute of limitations. Ibid. ; see also Gabelli , 568
U. S., at 451–452 (“[P]enalties” in the context of §2462 “go beyond compensation, are intended to punish, and label defendants wrongdoers”).

B
Application of the foregoing principles readily demon

strates that SEC disgorgeme nt constitutes a penalty within the meaning of §2462. First, SEC disgorgement is imposed by the courts as a consequence for violating what we described in Meeker as public laws. The violation for which the remedy is sought is committed against the United States rather than an aggrieved individual—this is wh y, for example, a securitiesenforcement action may proceed even if victims do not support or are not parties to the prosecution. As the Gov

ernment concedes, “[w]hen the SEC seeks disgorgement, it acts in the public interest, to remedy harm to the public at large, rather than standing in the shoes of particular8 KOKESH v. SEC

Opinion of the Court

injured parties.” Brief for United States 22. Courts agree. See, e.g., SEC v. Rind , 991 F. 2d 1486, 1491 (CA9 1993) (“[D]isgorgement actions further the Commission’s public policy mission of protecting in vestors and safeguarding the integrity of the markets”); SEC v. Teo , 746 F. 3d 90, 102 (CA3 2014) (“[T]he SEC pursues [disgorgement] ‘inde

pendent of the claims of individual investors’ ” in order to

“ ‘promot[e] economic and social policies’ ”). Second, SEC disgorgement is imposed for punitive purposes. In Texas Gulf —one of the first cases requiring disgorgement in SEC proceed ings—the court emphasized the need “to deprive the defendants of their profits in order to . . . protect the inve sting public by providing an effective deterrent to future violations.” 312 F. Supp., at

92. In the years since, it has become clear that deterrence is not simply an incidental e ffect of disgorgement. Rather, courts have consistently held that “[t]he primary purpose of disgorgement orders is to deter violations of the securi

ties laws by depriving violators of their ill-gotten gains.”
SEC v. Fischbach Corp ., 133 F. 3d 170, 175 (CA2 1997);
see also SEC v. First Jersey Securities, Inc. , 101 F. 3d 1450, 1474 (CA2 1996) (“The primary purpose of dis

gorgement as a remedy for violation of the securities laws is to deprive violators of their ill-gotten gains, thereby effectuating the deterrence objectives of those laws”);
Rind , 991 F. 2d, at 1491 (“ ‘The deterrent effect of [an SEC] enforcement action would be greatly undermined if securi

ties law violators were not required to disgorge illicit profits’ ”). Sanctions imposed for the purpose of deterring infractions of public laws are inherently punitive because “deterrence [is] not [a] legi timate nonpunitive governmen

tal objectiv[e].” Bell v. Wolfish , 441 U. S. 520, 539, n. 20 (1979); see also United States v. Bajakajian , 524 U. S. 321, 329 (1998) (“Deterrence . . . has traditionally been viewed as a goal of punishment”). Finally, in many cases, SEC disgorgement is not com

-9 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

pensatory. As courts and the Government have employed the remedy, disgorged profits are paid to the district court,
and it is “within the court’s discretion to determine how and to whom the money will be distributed.” Fischbach Corp ., 133 F. 3d, at 175. Courts have required disgorge

ment “regardless of whether the disgorged funds will be paid to such investors as restitution.” Id ., at 176; see id

., at 175 (“Although disgorged funds may often go to com

pensate securities fraud victims for their losses, such compensation is a distinctly secondary goal”). Some dis

gorged funds are paid to victims; other funds are dispersed to the United States Treasury. See, e.g. , id., at 171 (af

firming distribution of disgorged funds to Treasury where “no party before the court wa s entitled to the funds and . . . the persons who might have equitable claims were too dispersed for feasible identification and payment”); SEC v. Lund , 570 F. Supp. 1397, 1404–1405 (CD Cal. 1983) (or

dering disgorgement and directing trustee to disperse funds to victims if “feasible” and to disperse any remain

ing money to the Treasury). Even though district courts may distribute the funds to the victims, they have not identified any statutory command that they do so. When an individual is made to pay a noncompensatory sanction to the Government as a consequence of a legal violation, the payment operates as a penalty. See Porter v. Warner Holding Co. , 328 U. S. 395, 402 (1946) (distinguishing between restitution paid to an aggrieved party and penal

ties paid to the Government). SEC disgorgement thus bears all the hallmarks of a penalty: It is imposed as a consequence of violating a public law and it is intended to deter, not to compensate. The 5-year statute of limitat ions in §2462 therefore ap

plies when the SEC seeks disgorgement.

C
The Government’s primary response to all of this is that10 KOKESH v. SEC

Opinion of the Court

SEC disgorgement is not puniti ve but “remedial” in that it “lessen[s] the effects of a violation” by “ ‘restor[ing] the status quo.’ ” Brief for Respondent 17. As an initial mat

ter, it is not clear that disgorgement, as courts have ap

plied it in the SEC enforcement context, simply returns the defendant to the place he would have occupied had he not broken the law. SEC disgorgement sometimes exceeds the profits gained as a result of the violation. Thus, for example, “an insider trader ma y be ordered to disgorge not only the unlawful gains that accrue to the wrongdoer directly, but also the benefit that accrues to third parties whose gains can be attributed to the wrongdoer’s conduct.”
SEC v. Contorinis , 743 F. 3d 296, 302 (CA2 2014). Indi

viduals who illegally provide confidential trading infor

mation have been forced to disgorge profits gained by
individuals who received and traded based on that infor

mation—even though they never received any profits.
Ibid ; see also SEC v. Warde , 151 F. 3d 42, 49 (CA2 1998) (“A tippee’s gains are attributable to the tipper, regardless whether benefit accrues to the tipper”); SEC v. Clark , 915
F. 2d 439, 454 (CA9 1990) (“[I]t is well settled that a tipper can be required to disgorge his tippees’ profits”). And, as demonstrated by this case, SEC disgorgement sometimes is ordered without consideration of a defendant’s expenses that reduced the amount of illegal profit. App. to Pet. for Cert. 43a; see Restatement (Third) §51, Comment h , at 216 (“As a general rule, the defendant is entitled to a deduction for all marginal costs incurred in producing the revenues that are subject to disgorgement. Denial of an otherwise appropriate deduction, by making the defendant liable in excess of net gains, results in a punitive sanction that the law of restitution normally attempts to avoid”). In such cases, disgorgement does not simply restore the status quo; it leaves the defendant worse off. The justifi

cation for this practice gi ven by the court below demon

strates that disgorgement in this context is a punitive,11 Cite as: 581 U. S. ____ (2017)

Opinion of the Court

rather than a remedial, sanction: Disgorgement, that court explained, is intended not only to “prevent the wrongdoer’s unjust enrichment” but also “to deter others’ violations of the securities laws.” App. to Pet. for Cert. 43a. True, disgorgement serves compensatory goals in some cases; however, we have emphasized “the fact that sanc

tions frequently serve more than one purpose.” Austin v. United States , 509 U. S. 602, 610 (1993). “ ‘A civil sanction that cannot fairly be said solely to serve a remedial pur

pose, but rather can only be explained as also serving either retributive or deterrent purposes, is punishment, as
we have come to understand the term.’ ” Id., at 621; cf. Bajakajian , 524 U. S., at 331, n. 6 (“[A] modern statutory forfeiture is a ‘fine’ for Eighth Amendment purposes if it constitutes punishment even in part”). Because disgorge

ment orders “go beyond compensation, are intended to punish, and label defendants wrongdoers” as a conse

quence of violating public laws, Gabelli , 568 U. S., at 451– 452, they represent a penalty and thus fall within the 5

- year statute of limitations of §2462.

III
Disgorgement, as it is applied in SEC enforcement proceedings, operates as a penalty under §2462. Accord

ingly, any claim for disgorge ment in an SEC enforcement action must be commenced within five years of the date

the claim accrued. The judgment of the Court of Appeals for the Tenth
Circuit is reversed.

It is so ordered.