The United States House Committee on Oversight and Accountability has sent a letter to the Securities and Exchange Commission Chairman, Gary Gensler, threatening him with disciplinary action if he continues to be uncooperative with the oversight committee.
Signed by committee chair James Comer, the letter said:
The House Committee on Oversight and Accountability has been conducting oversight of the SEC, especially actions taken to circumvent Congress to further an agenda that harms American taxpayers.
As the SEC Chair, you have obstructed and continue to obstruct congressional oversight. If you do not begin cooperating with the Committee’s oversight, the Committee has no choice but to consider the use of the compulsory process.
The committee wrote to Gensler in June requesting documents and information on the SEC’s involvement in the development of European social engineering initiatives disguised as disclosure and due diligence directives being developed by the European Union (EU).
Comer and senator Tim Scott said:
This Administration has hidden behind ‘interoperability of disclosure regimes’ as its justification for global coordination. However, it is not clear that the law provides such authority and we must determine whether legislation is necessary to ensure our government works for the American taxpayer and not on behalf of foreign interests.
Despite our patience, we have not received the information requested for almost four months, as the SEC has continuously delayed and misdirected.
He added that the SEC has not yet produce any documents that are “substantively responsive,” and added that the “overwhelming majority of documents produced have been publicly available on the SEC’s website, publicly available comments to rulemaking, or documents that were already released pursuant to the Freedom of Information Act.”
Comer said that the “purported productions” are not conducive to the request.
The Committee is unpersuaded by the SEC’s repeated insinuation to my Congressional staff that Congress is unable to obtain non-public information without a vote of the full Commission authorizing the disclosure.
Comer stressed that the ability of the US Congress to conduct oversight of the Executive Branch “is inherent in its legislative powers enumerated in the U.S. Constitution and exists independently of any vote of the SEC.”
The Commission may not at whim suspend or immunize itself from the exercise of that power,” he said. “The SEC – an agency whose entire regulatory regime is built on disclosure and transparency – seems to do everything it can to stonewall our investigation and prevent disclosure and transparency.
He underlined a number of recent press releases from the SEC that “publicly tout[ed] its enforcement results. And “despite the SEC’s expectation of transparency and cooperation from registrants, your agency is delaying, misleading, and blocking access to the records the Committee. Certainly, the SEC would not tolerate similar action by registrants,” he continued.
“The Committee’s frustration with the SEC’s lack of cooperation with our reasonable oversight requests is clear,” he said. “I expect nothing less than full cooperation with our inquiry, which begins with [the] SEC providing documents actually responsive to our requests. If the SEC continues to fail to produce the requested documents by October 19, 2023, I will consider other measures, including the use of the compulsory process, to gain compliance.”
Gensler has yet to publicly address the letter.
As reported by Bloomberg, the SEC will not ask a federal appeals court to reconsider a ruling that opens the door for Grayscale Investments to launch a spot Bitcoin exchange-traded fund. This means that Grayscale’s bid to convert its GBTC trust into an ETF will no longer be delayed by the SEC following a federal rebuke of the SEC under chairman Gensler by Judge Neomi Rao.
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