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Senator Emmer says SEC is ‘politicizing enforcement, baiting companies’

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US MP Tom Emmer accused The Securities and Exchange Commission (SEC) on “pursuing companies outside of its jurisdiction.”

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At an investor protection subcommittee hearing on July 19, SEC director of enforcement Gurbir Grewal acknowledged that the commission has routinely operated outside of its jurisdiction.

SEC acted out of jurisdiction

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Senator Emmer wondered how the SEC would react if a cryptocurrency company did not respond to the commission’s industry review letter.

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The extended letter invites companies to voluntarily provide information to the regulator.

Director Grewal responded that the regulator could “go ahead with the subpoena and then enforce the subpoena.”

According to Grewal, the SEC is not limited to “jurisdiction when we collect evidence. We follow the evidence wherever it leads us.”

Gruel’s statement prompted a strong reaction from Emmer, who said the commission was using its enforcement arm to expand its jurisdiction.

According to Emmer, the SEC is not interested in finding out if cryptocurrencies fall under its jurisdiction, as seen in the dissolution of FinHub, the SEC’s cryptocurrency rule-making arm.

Instead, the Securities and Exchange Commission, under Gary Gensler, is “obsessed with increasing the size of its crypto enforcement division, using enforcement to unconstitutionally expand its jurisdiction.”

Emmer continued that the Securities and Exchange Commission “politicized the rules by forcing companies to ‘come and talk’ with the Commission and then enforced them,” thus “preventing fair dealing.”

Another MP, Brad Sherman, criticized the commission’s failure to take enforcement action against major exchanges that have facilitated Ripple (XRP) trading.

SEC under fire for its approach to regulating cryptocurrencies

The SEC has come under fire for its approach to regulating cryptocurrencies.

Hester Pierce, Commissioner of the SEC, criticized the financial regulator’s approach to regulating the crypto space.

Pierce said one-time enforcement measures are not the best way to build a foundation for the industry.

In addition, several industry players also criticized regulation of the regulator by law enforcement tactics.

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