A group of Republican members of Congress have launched an investigation into the missing text messages of former SEC Chairman Gary Gensler. This concerns communications that were lost when his service telephone was deleted.
According to critics, this directly affects the question of whether the SEC acted with sufficient transparency and care during Gensler’s tenure.
Republicans want clarification from SEC Chairman Atkins
The issue came to light after the SEC’s internal regulator, the Office of Inspector General (OIG), concluded in early September that Gensler’s posts were accidentally deleted between October 2022 and September 2023.
According to the report, conversations related to ongoing enforcement cases against crypto companies were also lost. This makes it unclear whether important communications surrounding supervisory decisions can ever be fully reconstructed.
The Republicans want clarification from current SEC Chairman Paul Atkins. In a letter, committee chairman French Hill said his Financial Services Committee is “in discussions with the OIG to obtain further clarity and determine whether additional oversight is necessary.” Hill calls the missing messages “worrying for the integrity of the regulator”.
SEC IT policy led to the deletion of Gensler’s device
According to the OIG, the cause lies in poorly implemented automatic IT policies within the SEC. That policy led to a complete reset of Gensler’s device. The problems were exacerbated by system warnings being ignored and backups missing. A software error from an external supplier also played a role.
The case is made even more charged because Gensler imposed significant fines on financial institutions in 2023 for “record-keeping failures”. In doing so, the SEC raised more than $400 million. Republican politicians speak of a double standard. “It appears that Gensler held companies to rules that he himself could not enforce,” the letter says.
Gensler was considered the industry’s fiercest opponent
The issue is being followed with great interest, especially within the crypto sector. Gensler was seen as one of the industry’s fiercest opponents during his term. Under his leadership, several major crypto companies were indicted for violating securities laws. Critics suspect that Gensler’s policy was part of a broader strategy by the Biden administration to make banks more wary of crypto ventures.
The fact that the deleted text messages also concerned conversations about these enforcement cases increases the suspicion. Analysts wonder whether the SEC operated completely transparently under Gensler, or whether there was selective communication that can now never be recovered.
Source: https://newsbit.nl/huis-van-afgevaardigden-onderzoekt-verwijderde-berichten-van-gary-gensler/
