SEC Chair Gary Gensler Called Out by House Representatives Over FTX
Jessie A Ellis Feb 13, 2023 09:26
Former FTX CEO Sam Bankman-Fried was supposed to appear before the House Financial Services Committee in December. Lawmakers are questioning his arrest.
The chairman of the Securities and Exchange Commission, Gary Gensler, has been criticized by two members of the United States House Financial Services Committee "regarding the timing of the charges filed against FTX founder Sam Bankman-Fried." This criticism is based on the fact that Mr. Gensler is scheduled to appear at a hearing.
The chair of the committee, Patrick McHenry, and the chair of the Oversight and Investigations Subcommittee, Representative Bill Huizenga, stated in a notice dated February 10 that the timing of Bankman-charges Fried's and arrest in the Bahamas raised "serious questions about the SEC's process and cooperation with the Department of Justice." The two congressmen requested that Gensler disclose documents and correspondence relating to SBF's accusations that were exchanged between November 2 and February 9 from the SEC's Division of Enforcement, his office, and between the agency and the Justice Department during that time period.
On December 13, the House Financial Services Committee was going to hold a hearing to investigate the failure of the cryptocurrency exchange FTX, and Bankman-Fried was set to speak before the committee. On the other hand, the previous CEO of FTX was taken into custody in the Bahamas in line with an extradition arrangement with the United States of America. The Justice Department has filed eight criminal charges against Bankman-Fried, one of which is for wire fraud. Additionally, the Securities and Exchange Commission and the Commodity Futures Trading Commission have each filed separate civil lawsuits against the former CEO.
In a tweet sent out on February 10, Huizenga said, "Since Gary Gensler won't follow by his own policies to 'come in and speak,' the House GOP will hold him responsible."
McHenry and Huizenga made a request to Gensler to provide the material by the 23rd of February at the latest. This week, the chair of the SEC was subjected to an increased level of scrutiny as a result of the agency's announcement of a settlement with Kraken, in which the exchange agreed to cease providing staking services or programs to customers in the United States.
FTX CEO John Ray was the only witness at the hearing that took place in December since Bankman-Fried was unable to attend. However, the Senate Banking Committee had its own hearing on December 14 to investigate the "bubble bust" that occurred with FTX. On February 14, there will be a further hearing about the "crypto collapse" of 2022 that has been planned by the banking committee.
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