Key Points
Empower Oversight has initiated legal proceedings against the U.S. Securities and Exchange Commission (SEC). The lawsuit is a response to the SEC’s refusal to release a report investigating ethical conflicts and selective enforcement within the agency. The SEC Office of Inspector General completed this report over a year ago, but it remains unreleased despite multiple Freedom of Information Act requests. The lawsuit can be viewed here.
Investigating Potential Conflicts of Interest
The lawsuit aims to force the SEC to reveal findings related to William Hinman, the former director of the SEC Division of Corporate Finance. The investigation centers on possible conflicts of interest tied to Hinman’s past association with the law firm Simpson Thacher. The firm had financial interests in promoting Ethereum (ETH).
Empower Oversight has been pushing for SEC transparency since August 2021. The watchdog has filed numerous FOIA requests and lawsuits seeking documents related to the SEC’s communications with cryptocurrency entities. Empower Oversight suggests that the SEC’s delays indicate a pattern of evading responsibility in its enforcement actions.
Tristan Leavitt, president of Empower Oversight, expressed his frustration with the SEC’s lack of response. He stressed the importance of transparency in addressing concerns about regulatory bias and ensuring accountability in the cryptocurrency sector. His statement can be read here.
The SEC’s regulatory approach has been the subject of increasing criticism. Industry leaders, including Coinbase, have accused the agency of selective enforcement. Gary Gensler, the former SEC Chair, also faced criticism for his aggressive legal actions against major cryptocurrency firms like Coinbase and Ripple.
Empower Oversight continues its efforts to obtain the SEC OIG report. The watchdog argues that public access to the report’s findings is crucial for evaluating the SEC’s management of cryptocurrency regulations.