Much has been written and said about the Securities and Exchange Commission's summer settlement with Goldman, Sachs & Co., but one of the most important features of the case received far too little attention. It deserves closer scrutiny because it goes to the heart of the federal government's role in enforcing the securities laws and suggests that the current SEC may view that role far more expansively than its predecessors ever did.

Throughout the agency's 76-year history, the vast majority of its enforcement cases have sought to stop and punish wrongdoing perpetrated against some identifiable group of victims -- typically retail investors and often unsophisticated ones -- or against the market generally. In most such cases, the SEC plays a vital role because no individual victim necessarily has the ability or financial incentive to bring the wrongdoer fully to justice.

For example, financial fraud cases involving public companies typically allege injury to all shareholders. Likewise, insider trading cases are premised on unfairness to all those who traded without the secret information known to the wrongdoer, while Ponzi scheme cases usually seek to recover funds stolen from a large number of investors.

SEC charges against brokerage firms and mutual funds typically cite many customers who were victimized, and market manipulations usually infect entire markets for a particular stock. In short, as the self-described "Investor's Advocate," the SEC mostly stands in the shoes of the "little guys" who have been ripped off by much more sophisticated players against whom they wouldn't stand a fighting chance on their own.

Not so with the Goldman Sachs case.

As the SEC's complaint made clear -- and the settlement even clearer -- the victim class was composed of only two highly sophisticated European banks, both presumably having ample means and incentive to sue if a fraud in fact occurred. Neither appears to have done so yet. According to recent media reports, both banks are still considering their options.

And yet, courtesy of the SEC's commendable efforts, out of the $550 million settlement fund, $150 million will be paid directly to one of these banks and $100 million to the other -- without either of them having to incur the usual cost or effort of suing anyone themselves. (The remaining $300 million goes to the U.S. Treasury; none goes to any individual investors.) Not a bad deal if you can get it.

Of course, nothing in the law prevents the SEC or other federal agencies from, in essence, taking sides in a dispute between sophisticated financial institutions and pursuing litigation against one to benefit the other, particularly when the agency thinks the case might send an important message to achieve a broader impact. But there are many such disputes in the financial markets, and the agency surely can't intervene in all of them, or even a tiny fraction of them. The question is not whether these sophisticated investors deserve protection under the securities laws (of course they do), but whether taxpayers should be saddled with the cost and burden of recovering their losses for them, particularly in an era of mounting federal deficits.

Undoubtedly, a case like Goldman Sachs consumes a disproportionate share of the agency's limited resources when compared with more mundane cases. And for every Goldman Sachs case it pursues on behalf of sophisticated banks, the SEC necessarily diverts resources away from potential Madoff cases and other scams against mom-and-pop investors. For an agency described as "chronically underfunded" by the Senate Banking Committee's official summary of the Dodd-Frank financial reform law -- which calls for nearly doubling the SEC's budget over the next five years -- this inevitably means carefully picking a relatively small number of battles to get the most bang for the buck.

The Goldman Sachs settlement should help convince critics that the SEC remains a premier law enforcement agency. But the SEC simply can't be everywhere at the same time, nor should it try to be. That reality should not be lost as the agency reflects upon lessons learned from its recent settlement, and as it considers how it will spend the additional new funds promised by Dodd-Frank.

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Russell G. Ryan, a securities lawyer with King & Spalding LLP in Washington, is a former assistant director of the SEC's division of enforcement.