House Republicans Seek Answers From SEC on Co-Founder’s Arrest

On February 10, 2023, U.S. House of Representatives members Patrick McHenry of North Carolina and Bill Huizenga of Michigan sent a letter to the Chairman of the Securities and Exchange Commission (SEC), Gary Gensler, inquiring about the timing of the arrest of the FTX co. founder Sam Bankman-Fried, who had given his testimony earlier than planned to the House Financial Services Committee.

House Republicans Question SEC Regarding Arrest of Sam Bankman-Fried

With the Securities and Exchange Commission (SEC) cracking down on Kraken staking companies in the United States, House Financial Services Chairman Patrick McHenry and Supervisory Subcommittee Chairman Bill Huizenga of the U.S. House of Representatives have declared they are investigating the matter with the SEC. Specifically, they are inquiring about the “timing of the SEC-DOJ action against Sam Bankman-Fried.” In a letter sent to SEC Chairman Gary Gensler, the two representatives asked for “data and communications between the Office of the President, the SEC’s enforcement division and the Department of Justice concerning the Bankman-Fried matter.”

“The SEC’s Enforcement Division reportedly conducted a full investigation into the actions of Sam Bankman-Fried and submitted the findings to the Commission for review and to authorize the charges,” the letter noted. “However, the timing of the charges and his arrest raises serious questions about the SEC process and cooperation with the Department of Justice. The American people deserve transparency from him and from his agency,” it added.

The letter requests all data and communications between the staff of the Enforcement Division pertaining to Bankman-Fried’s charges. The second request includes all communications and filings between the SEC and the DOJ. The third request covers all data and communications between employees of the Office of the President and Chairman Gensler regarding Bankman-Fried’s additional charges or arrests. House Republicans have given the SEC a deadline as they need the materials urgently.

“Please provide this material as soon as possible, but no later than 5:00 pm on February 23, 2023,” the letter reads. “The Committee on Financial Services has jurisdiction to oversee the activities of the Securities and Exchange Commission pursuant to Rule X of the House Rules.”

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