US Congressman Tom Emmer said in a tweet that he had received reports that SEC Chairman Gary Gensler had helped Sam Bankman-Fried and FTX “work through legal loopholes to gain a regulatory monopoly “.
Interesting. @GaryGensler runs to the media as reports to my office allege he was helping SBF and FTX work out legal loopholes to gain a regulatory monopoly. We are looking at that. https://t.co/SznowgcP6V
— Tom Emmer (@RepTomEmmer) November 10, 2022
The crypto community questions the relationship between Gensler and SBF
The crypto community has questioned the relationship between Gensler and the FTX founder, with many calling it shady.
Speculation within the community has alleged that SBF’s drive for regulation is fueled by attempts to control the crypto space. Some have also speculated that the SEC Chairman was influenced by connections during his time at the Massachusetts Institute of Technology (MIT).
A tweet from HR Cult said Gensler’s boss at MIT was the father of Alameda CEO Caroline Ellison. The SBF Wikipedia page shows that he graduated from the school in 2014.
Gary Gensler’s boss at MIT Glenn Ellison is the father of co-CEO Caroline Ellison of #Alameda To research. @SBF_FTX also went to MIT and helped create #AlamedaResearch . Sounds like a setup to crack down #crypto and control the system.
– HR CULT (@HEXCULT1) November 10, 2022
It should be noted that the ties between FTX and the SEC go beyond in-person meetings.
FTX US General Counsel had been Chairman Gensler’s lead counsel at the CFTC.
Everyone agrees that he is an upright and excellent lawyer.
Thing is, the SEC was pretty close. https://t.co/ohez0oXSjo
— Danish Lund (@lund_dane) November 11, 2022
Additionally, SBF caught up with Gensler earlier this year, leading the community to examine his donations to politicians.
Delphi Digital’s general counsel, Gabriel Shapiro, called the money spent by FTX “political bribes.”
“The recent collapse of a major crypto exchange proves that the bill we colluded with the owner of this crypto exchange to draft after spending $40 million in political bribes to do so is the best way forward”
Jesus. Fucking. Christ. https://t.co/LeOZxrKkRB
— _gabrielShapir0 (@lex_node) November 11, 2022
Popular crypto attorney Jake Chervinsky said FTX was close to making a deal with the financial regulator that would have set a bad precedent for everyone else. Chervinsky thanked Congressman Emmer for looking into these allegations.
Meanwhile, reports have surfaced that US lawmakers are advancing the SBF-backed bill with plans to increase oversight of the crypto space. Several crypto industry leaders have critical The law project.
The Stabenow-Boozman-FTX (SBF) bill wouldn’t have prevented this disaster because FTX helped write it!
And did it in a way that would have allowed them to hide the problems indefinitely, while raising MORE money from US institutional investors.
— Ryan Selkis 🥷 (@twobitidiot) November 11, 2022
The SEC would investigate SBF
In a separate development, Bloomberg News reported that the SEC was investigating whether SBF and its companies violated securities regulations, citing unnamed sources.
According to the report, the regulator was scrutinizing SBF’s role in the recent liquidity crisis. He added that the watchdog is also investigating whether FTX.US and its cryptocurrency lending activities violate the law.
FTX came under intense regulatory scrutiny after its implosion. US regulators are investigating the relationship between SBF’s myriad businesses and whether the crypto exchange mishandled customer funds.