The United States Securities and Exchange (SEC) Chair Gary Gensler is facing intense scrutiny over his leadership, with Minnesota Representative Tom Emmer criticizing him as the most destructive and lawless chair in the agency’s history.
Gary Gensler Under Fire
During a House Financial Services Committee hearing, Emmer accused Gensler of making up crypto asset security and never provided any framework for defining crypto assets.
“You’ve made up the term’ crypto asset security.’ This term is nowhere to be found in statute. You made it up. You never provided any interpretive guidance on how ‘crypto asset security’ might be defined within the walls of your SEC,” Emmer said.
The representative also alleged that Gensler sought political loyalty from SEC employees, including civil servants, though the SEC chair denied the accusation despite email evidence suggesting otherwise.
He further noted that the hiring practice Gensler implements and culture fosters a sense of loyalty among staff to him, placing it above the law and the SEC’s mission.
In recent years, the SEC has initiated legal actions against several prominent fintech and crypto firms, such as Ripple, Coinbase, Kraken, BlockFi, Telegram, Celsius, Binance, and others, as part of its ongoing crackdown on the industry.
“You’ve retaliated against businesses and people who have come before this committee to talk about the next generation of American finance,” Emmer added.
Gensler’s Abuse of Power
The representative noted that Gensler misused the agency’s enforcement powers and lured companies willing to cooperate with him, only to subject them to enforcement actions later.
He also mentioned the Debt Box case, in which the SEC was penalized for significant misrepresentation in court. This led to the agency incurring nearly $2 million in legal fees funded by taxpayers. The case against Debt Box was dismissed on May 28, 2024.
The recent hearing comes after Vice Presidential Kamala Harris announced plans to shape crypto policies, criticizing Gensler’s method of overseeing the industry due to the resulting confusion in the crypto space and several ongoing court cases.
Meanwhile, Emmer said that the SEC broke the law and its attorney lied to the court regarding businesses in Washington, D.C.
