Those who fail to demonstrate earnings of more than £35,000 will be denied settlement in the UK and will face deportation according to the new Home Office policy.
Judge Rakoff made his stand against "neither admit nor deny settlements" in the S.E.C.'s case against Citigroup, a bank that performed particularly badly during the financial crisis.
Lawyers both inside and outside the S.E.C. argued that the "neither admit nor deny" settlements were perhaps the only way to get companies to settle fraud cases, because to admit wrongdoing would open them to civil damages.
Native leaders see the referendum idea as an effort to delay or deny settlements, and have promised a campaign of civil disobedience to block it.None of these worries looks likely to save the NDP.
Mr. Khuzami, the S.E.C.'s enforcement director, defends the "neither admit nor deny" settlements in part by saying that because the S.E.C. lays out such detail in its complaints, there can be no doubt what occurred.
They compared that harmful outcome to shareholders against a negotiated "neither confirm nor deny" settlement with JPMorgan Chase this summer that had little effect on that bank's stock.
Robert Khuzami, the director of enforcement at the S.E.C., said the agency would continue to use the "neither admit nor deny" settlement process when the agency alone reached a deal with a company in a case of civil securities law violations.
In its court papers on Monday, Citigroup warned that anything other than a "no admit, no deny" settlement posed serious risks to the bank's shareholders, including additional private litigation, reputational harm and collateral regulatory consequences.
While another S.E.C. case in Wisconsin, where a federal district judge in December challenged an S.E.C. settlement, was subsequently approved, the cases demonstrate that Judge Rakoff's challenge of the "neither admit nor deny" settlement is reverberating beyond Wall Street and New York.
Most important, no-admit/no-deny settlements are no real deterrent to future bad behavior because they do not extract a heavy enough price, in dollars or reputation.
