concurring in part and dissenting in part.
I agree with the court that we should affirm the district court’s grant of summary judgment, its order permanently enjoining Brown and Jamerica from violating the laws cited in the SEC’s complaint, and the award of Tier III civil penalties. But I respectfully dissent from the decision to affirm the order that Brown disgorge $869,633, the amount fraudulently misappropriated from Brawta investors, together with prejudgment interest.
1. It is well-settled that the grant of broad jurisdiction to remedy violations of the federal securities laws includes the power to order a defendant guilty of securities fraud “to disgorge any ill-gotten profits.” SEC v. Ridenour, 913 F.2d 515, 517 (8th Cir.1990). Disgorgement is an equitable remedy. Its purposes are to provide a remedy for fraud victims and to deprive the defendant of unjust enrichment, not to punish. SEC v. First City Fin. Corp., 890 F.2d 1215, 1231 (D.C.Cir.1989). A defendant’s financial inability to repay is no defense to an order that he disgorge his ill-gotten gain. SEC v. Warren, 534 F.3d 1368, 1370 & n. 2 (11th Cir.2008); SEC v. United Energy Partners, Inc., 88 Fed.Appx. 744, 746 (5th Cir.), cert. denied, 543 U.S. 1034, 125 S.Ct. 808, 160 L.Ed.2d 597 (2004).
The federal securities laws protect investors and the integrity of the securities markets. For some violations, the defendant’s ill-gotten gain equals the losses of identifiable victims. Courts of equity have a remedy for such wrongs — restitution— and it is consistent with Congress’s grant of civil enforcement powers to the SEC that the agency be granted that remedy for the benefit of defrauded investors. Thus, in many cases, disgorgement orders have expressly provided that the amounts disgorged would be paid to defrauded investors. See SEC v. Walker, 1989 WL 168007, at *1 (8th Cir.1989); SEC v. Blavin, 760 F.2d 706, 710 (6th Cir.1985); SEC v. MacDonald, 699 F.2d 47, 52 (1st Cir.1983) (en banc); SEC v. Manor Nursing Ctrs., Inc., 458 F.2d 1082, 1103 (2d Cir.1972).
For other securities law violations, such as insider trading, there may be no identifiable investor victim or measurable investor losses. In these cases, making the wrongdoer give up his ill-gotten gain protects the integrity of the securities markets by helping to deter similar violations. Again, courts of equity have such a remedy — unjust enrichment — and the SEC has frequently sought and obtained disgorgement orders despite the absence of identifiable defrauded investors. See, e.g., SEC v. Tome, 833 F.2d 1086, 1096 (2d Cir.1987), cert. denied, 486 U.S. 1014, 1015, 108 S.Ct. 1751, 100 L.Ed.2d 213 (1988); SEC v. Commonwealth Chem. Secs., Inc., 574 F.2d 90, 102 (2d Cir.1978). However, even when the remedy is intended to deter misconduct by members of the securities industry in general, it must be remedial, not punitive. See Beck v. SEC, 430 F.2d 673, 674-75 (6th Cir.1970).
In this case, Brown did not fraudulently profit from securities transactions; he simply pocketed funds that he promised victims he would invest. The SEC proved that he fraudulently diverted $869,633 of the $1.62M that fifty-three identifiable vie*862tims invested in Brawta. For these violations, recovering victim losses was the proper focus of an equitable monetary remedy. At the outset of the case, the district court took appropriate action toward that end, freezing defendants’ assets and, when Brown filed for bankruptcy protection, appointing a receiver who aggressively — and with considerable success— sought remedies for the defrauded investors in the bankruptcy case. Then, with these remedies in place, the SEC asked for “disgorgement” of all wrongfully diverted funds. The SEC did not explain what remedial purpose would be served by this remedy. It did not disclose, much less propose an order clarifying, whether any monies disgorged would be paid to defrauded investors. Nor did it address whether imposing a massive monetary obligation on an obviously insolvent debtor would adversely affect the ongoing efforts of the receiver and the bankruptcy trustee to recover the victims’ losses.
Equitable remedies should issue only upon a concrete showing of need and should impose the least drastic remedy necessary to achieve the desired goals. See Mills v. Elec. Auto-Lite Co., 396 U.S. 375, 386, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970); Hecht Co. v. Bowles, 321 U.S. 321, 329-30, 64 S.Ct. 587, 88 L.Ed. 754 (1944). The district court’s cursory examination of this issue simply stated the SEC “requests that defendants be disgorged of the $869,633 misappropriated from Brawta.” 579 F.Supp.2d at 1238. The court did not consider whether the permanent injunction, coupled with substantial civil penalties, were sufficient to deter future violations. See SEC v. Thomas James Assocs., Inc., 738 F.Supp. 88, 92-93 (W.D.N.Y.1990). It did not consider whether amounts recovered by the receiver or expenses attributable to legitimate investment activities should offset the amount to be disgorged, as other cases have required to ensure that disgorgement is remedial and not punitive. See SEC v. Global Express Capital Real Estate Inv. Fund, I, LLC, 289 Fed.Appx. 183, 190 (9th Cir.2008); SEC v. JT Wallenbrock & Assocs., 440 F.3d 1109, 1114 (9th Cir.2006); United Energy Partners, 88 Fed.Appx. at 747. Nor did it address whether this remedy would interfere with the victims’ efforts to recover their losses. On this record, the only apparent rationale for the SEC’s disgorgement request was punitive, not remedial. It was an abuse of discretion to grant that request, see Walker, 1989 WL 168007, at *2 (standard of review), particularly without holding an evidentiary hearing on these issues, see SEC v. Smyth, 420 F.3d 1225, 1232-33 (11th Cir.2005). I would remand for further consideration of the disgorgement issue.
2. I will also explain my narrow reason for affirming the grant of summary judgment, because the court’s summary affirmance fails to address a potentially recurring problem in the district court’s disposition of the SEC’s motion.
In April 2007, Brown submitted answers to SEC interrogatories. Ten days later, the United States Attorney notified defense counsel that Brown was the target of a criminal investigation. After the district court denied Brown a stay of the civil proceedings, he asserted his Fifth Amendment privilege against self-incrimination and refused to answer substantive questions when the SEC took his deposition in the civil case. In granting summary judgment, the court ruled that it would not consider Brown’s interrogatory responses, the only evidence he submitted as non-moving party, “to prevent unfairness to the SEC” because his assertion of the privilege “prevented the SEC from exploring and clarifying [the interrogatory] responses in a deposition.” SEC v. Brown, 579 F.Supp.2d 1228, 1235 (D.Minn.2008). I conclude the court abused its discretion *863when it denied a stay and excluded all evidence offered in opposition to the SEC’s motion for summary judgment.
The Fifth Amendment permits an adverse inference when the privilege against self-incrimination is claimed by a party in a civil case. See Baxter v. Palmigiano, 425 U.S. 308, 320, 96 S.Ct. 1551, 47 L.Ed.2d 810 (1976). A district court may also “monitor whether the assertion of a privilege causes unfair prejudice to the opposing litigant.” FTC v. Kitco of Nev., Inc., 612 F.Supp. 1282, 1291 (D.Minn.1985). But “the district court’s discretion narrows as the severity of the sanction or remedy it elects increases.” Wegener v. Johnson, 527 F.3d 687, 692 (8th Cir.2008). Precluding evidence is an extreme sanction that must be remedial, not punitive. “Because the privilege [against self-incrimination] is constitutionally based, the detriment to the party asserting it should be no more than is necessary to prevent unfair and unnecessary prejudice to the other side.” SEC v. Graystone Nash, Inc., 25 F.3d 187, 192 (3d Cir.1994).
When the government seeks civil remedies under statutes whose violations may be criminally prosecuted — such as the federal securities laws — courts should give “special consideration ... to the plight of the party asserting the Fifth Amendment.” Graystone Nash, 25 F.3d at 194. In an appropriate case, this may warrant, instead of a preclusion order, an order permitting the party to testify at the civil trial, as in Kitco, 612 F.Supp. at 1291; or barring use of the defendant’s testimony in the civil case at any subsequent criminal proceeding, as in United States v. Parcels of Land, 903 F.2d 36, 44 (1st.Cir.1990); or staying the civil case until the defendant is indicted or the criminal statute of limitations expires, as in Wehling v. Columbia Broad. Sys., 608 F.2d 1084, 1089 (5th Cir.1979). These are delicate and difficult issues, and district courts have substantial discretion to resolve them. But here, the district court did not even consider whether Brown’s assertion of the privilege warranted a less severe remedy than an order effectively defaulting his opposition to the SEC’s motion for summary judgment. Brown’s interrogatory responses were submitted prior to. his assertion of the privilege and months before the SEC moved for summary judgment. There was no unfair surprise and little if any prejudice. This was “a far cry from [a case] where invocation of the privilege prevented [a party] from obtaining the evidence it needed to prevail in the litigation.” Graystone Nash, 25 F.3d at 193.
Although the district court abused its discretion in excluding Brown’s interrogatory responses, I agree the grant of summary judgment must be affirmed because the error was harmless. See Fed.R.Civ.P. 61. In opposing the SEC’s motion, Brown argued that summary judgment was inappropriate on the issue of scienter, an element of claims under §§ 17(a)(1), 10(b), 206(1), and Rule 10b-5 requiring proof of intent to defraud. Aaron v. SEC, 446 U.S. 680, 695, 697, 100 S.Ct. 1945, 64 L.Ed.2d 611 (1980); SEC v. Steadman, 967 F.2d 636, 641 n. 3 (D.C.Cir.1992). But Brown’s uncorroborated assertion that he was entitled to substantial fees and twenty-percent of any asset appreciation, even if .credited, did not come close to rebutting the SEC’s evidence that one-half of investor' funds were transferred out of Brawta’s account, that large portions of the diverted funds were used for Brown’s personal expenses, and that he attempted to conceal the diversions. On this record, as in SEC v. Lyttle, 538 F.3d 601, 604 (7th Cir.2008), “no reasonable jury could doubt that [Brown] had acted with scienter.”