The Securities and Exchange Commission will be in front of the Supreme Court again to argue whether a federal court has the power to order a defendant to repay money obtained by fraud or insider trading.

The justices agreed to review the decision of the United States Court of Appeals for the Ninth Circuit in Liu v. S.E.C. In that case, a District Court found that Charles C. Liu and his wife, Lisa Wang, had defrauded 50 Chinese investors in an EB-5 Immigrant Investor Program. The couple were charged under Section 17(a)(2) of the Securities Act of 1933, which prohibits misstatements or omissions of material information when soliciting investments.

According to the S.E.C., the defendants diverted the $26 million they raised from the investors, who had been told that the money was going to build a cancer research center. The court ordered Mr. Lui and Ms. Wang to reimburse the investors and pay an $8.2 million civil penalty. The District Court prohibited Mr. Liu and Ms. Wang from participating in EB-5 programs in the future.

The issue before the Supreme Court will be whether a District Court can order a defendant to repay money obtained by fraud or trading on confidential information, or whether it is a penalty beyond the “equitable” power of the courts to require. The S.E.C. is sure to argue that a defendant who engages in fraud or insider trading should not be allowed to keep the profits, much as a thief has no claim to the money that is stolen.