Quick Breakdown
- House Republicans are probing the loss of Gensler’s SEC text messages, citing transparency concerns.
- Lawmakers accuse Gensler of double standards, enforcing strict rules on firms but not at the SEC.
- Deleted texts included conversations on crypto enforcement, deepening industry skepticism.
Republicans question transparency at the SEC
House Republicans have launched an investigation into the loss of text messages from former Securities and Exchange Commission (SEC) Chair Gary Gensler. In a letter to current SEC Chair Paul Atkins on Tuesday, House Financial Services Committee Chairman French Hill said the findings of the SEC’s Office of Inspector General (OIG) early September raised doubts about transparency during Gensler’s leadership from 2021 to 2025.
“to learn more about their report, seek clarity on outstanding questions, and discuss additional areas that require further oversight.”
Double standards alleged
The letter, also signed by Representatives Ann Wagner, Dan Meuser, and Bryan Steil, accused Gensler of enforcing strict record-keeping rules on Wall Street firms while failing to uphold the same standards at the SEC. Lawmakers pointed out that in 2023 alone, the regulator collected over $400 million in fines for record-keeping violations, even as Gensler’s own agency lost critical communications.
“It appears that former Chair Gensler held companies to a standard that his own agency did not meet,”
the letter stated.
SEC IT blamed for data wipe
According to the OIG, the SEC’s IT department was responsible for the deletion of Gensler’s text messages after applying a poorly managed automated policy. The wipe, which occurred between October 2022 and September 2023, erased key communications. Contributing factors included a lack of backup devices, ignored system alerts, and unaddressed software flaws.
Lost crypto enforcement records
Investigators revealed that some deleted texts were tied to SEC enforcement actions against crypto companies and their executives. This raises questions about whether critical decisions in high-profile crypto lawsuits can ever be fully reconstructed.
The agency has already faced scrutiny for past lapses, including a January 2024 incident where its official X account was hacked to falsely announce approval of spot Bitcoin ETFs. X later confirmed the SEC had failed to enable two-factor authentication at the time of the breach.
If you want to read more market analyses like this one, visit DeFi Planet and follow us on Twitter, LinkedIn, Facebook, Instagram, and CoinMarketCap Community.
“Take control of your crypto portfolio with MARKETS PRO, DeFi Planet’s suite of analytics tools.”
