- A US Senator has submitted a letter to Inspector General Deborah Jeffrey, asking for investigations on possible conflict of interest and political pressure related to recent SEC decisions to dismiss crypto-related cases, including that of Ripple.
- The letter mentions how Ripple boss Brad Garlinghouse made a $5 million donation to President Trump’s inaugural committee before the SEC dismissed the lawsuit against Ripple.
The US Securities and Exchange Commission (SEC), under the leadership of Paul Atkins, has taken decisions to walk away from multiple litigations against crypto firms.
As we discussed earlier, the Commission has announced a dismissal of civil enforcement actions against Coinbase while agreeing to drop the case against Consensus and Kraken. Additionally, the SEC is also reported to have walked away from its multi-year legal battle against Ripple Labs.
Fascinatingly, this has generated concerns of possible interference as U.S. Senator Elizabeth Warren writes a formal letter to the Office of Inspector General (OIG) at the Securities and Exchange Commission (SEC) to this effect. In the letter, the Senator requested an investigation into whether the Commission was unduly forced or influenced by US President Donald Trump or members of his family to make such decisions.
More About the Letter and the Concerns Around SEC’s Dismissal of the Ripple Case
Reviewing the letter, CNF found that it was addressed to Inspector General Deborah Jeffrey. Interestingly, Ripple was mentioned eight times including the recent appearance of the CEO Brad Garlinghouse at the White House crypto summit. Also, his donation of $5 million to the President’s inaugural committee was highlighted as suspicious, especially as it occurred before the SEC took this bold decision.
According to Warren, SEC’s recent decision appears to favour companies that are politically tied to Trump’s administration, sparking concerns of possible conflict of interest, political pressure, or even insider relationships.
Another point raised by the Senator has to do with the discussion by the Trump family to acquire a stake in Binance despite its founder, Changpeng Zhao (CZ), earlier pleading guilty to criminal charges. As mentioned in our previous news brief, CZ is reported to be seeking a presidential pardon to erase his criminal records and restore his financial influence. In a more worrying case, this discussion erupted after the Commission paused its case against the exchange.
In the case of whether the SEC’s decisions were influenced by those with a financial interest in the outcome, Paul Atkins was cited for having millions of dollars in crypto-related investments. According to Warren, there is a reasonable cause to worry.
On the previous statement by the Commission clarifying that most meme coins are not securities, Warren asked whether Trump’s Working Group on Digital Assets or any of his advisors were duly consulted or engaged before coming to that conclusion. This follows SEC Commissioner, Hester Peirce, challenging SEC’s control over meme coins, as indicated in our earlier discussion.
Fascinatingly, a crypto analyst and influencer, Crypto Eri, who earlier shared this letter, highlighted that the Senator also made several requests, including requests for records of communication, assessment of compliance with ethics laws and SEC policy, and a list of people who had advanced information of some of these important decisions by the Commission.
