A Democratic congressman has called for an independent investigation into the SEC’s failure to prevent the historic collapse of crypto exchange FTX.
In a letter sent on Tuesday, Representative Ritchie Torres (D-NY) requested the Government Accountability Office (GAO) carry out an unbiased assessment of the SEC’s actions—or lack thereof—prior to FTX’s collapse last month.
The letter particularly criticized SEC chair Gary Gensler for asserting exclusive control over crypto exchanges while not taking any effective action to regulate them.
Torres questioned why Mr. Gensler failed to uncover the largest crypto Ponzi scheme in US history if he claims to have the authority of the SEC. She argued that it is impossible to assert authority while avoiding accountability.
The letter was unequivocal in asserting that Gensler is “solely responsible for the regulatory errors that led to the downfall of FTX.”
Torres attacked Gensler’s character and questioned his decision-making by inquiring why he chose to examine famous people such as Kim Kardashian, instead of crypto exchanges such as FTX.
The Securities and Exchange Commission imposed a fine of $1.26 million on Kardashian in October for promoting EthereumMax, a cryptocurrency that the agency had determined to be an unregistered security.
To draw attention to this action, the SEC released a striking video featuring Gensler, an unusual move considering the usually dull nature of securities regulation.