SEC Boasts of Productive Year in Crypto Industry Prosecutions

The securities and exchange commission (SEC) has given itself an applause for “another highly productive year” in crypto-related charges in 2023

The agency said in a report that it filed 784 total enforcement actions in the fiscal year 2023, including big names and celebrities ranging from Coinbase and Sam Bankman-Fried to celebrities such as Kim Kardashian. The number has increased by 3% from last year.

“The investing public benefits from the Division of Enforcement’s work as a cop on the beat,” said SEC Chair Gary Gensler in a statement. “Last fiscal year’s results demonstrate yet again the Division’s effectiveness — working alongside colleagues throughout the agency — in following the facts and the law wherever they lead to hold wrongdoers accountable.”

also in the report, the agency said the enforcement division recommended actions addressing a wide range of cases ranging from crypto fraud to unregistered crypto offerings and celebrities illegally touting crypto.

Gensler has always maintained that cryptocurrencies and crypto exchanges fall under the purview of the agency and must be registered. Consequently, crypto exchanges such as  Bittrex, Binance, Beaxy and Coinbase were brought to book for not registering as security exchanges.

It also went after Terraform Labs and its founder Do Kwon, former FTX CEO Sam Bankman-Fried, crypto lender Celsius, among others, while celebrities included  Kim Kardashian, NBA Hall of Famer Paul Pierce, actress Lindsay Lohan, and YouTuber Jake Paul for promoting crypto assets without disclosing that they were  paid to do so.

The SEC also went after NFTs for the first time this year when it charged a Los Angeles-based podcasting studio with “conducting an unregistered offering of crypto asset securities.” It also brought similar charges against Stoner Cats 2 LLC.

$4.949 Billion Made

The SEC’s report also stated that $4.949 billion was made this year in financial remedies, which is the second highest annual record in the agency’s history. It also stated that it has distributed $930 million to investors who were victims of different crypto mishaps. 

Commenting on the achievements of the agency, Gensler said: 

“So what does this all mean?” Gensler said in a video on X. “It means that the SEC is hard at work on your behalf. We have and will continue to prevent future wrongdoings, hold accountable those who try to game the system, and protect investors so that our markets remain robust, dynamic, and fair to all.”

Meanwhile outside the crypto space, the agency also brought record-keeping related charges against Wells Fargo and HSBC, charges against Citadel Securities LLC over inaccurate data and fraud charges against the former CEO of McDonald’s, Stephen Easterbrook.

The SEC’s Crackdown

The SEC cracked down heavily on the crypto industry this year, dragging top companies like Coinbase and Binance to court. This massive crackdown may be directly responsible for the record-breaking achievements of the agency.

Meanwhile, there are more cases coming up as the enforcement arm of the agency said it will go after more crypto entities, especially in the DeFi ecosystem. In terms of revenue, this could mean that there’s more to come too.

The SEC is reportedly asking Ripple to settle after withdrawing its case against the company. This comes after Ripple won against the agency in July when it was ruled that XRP wasn’t a security. The agency decided to withdraw its appeal against the judgment.

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