SEC's FTX Probe Timing Questioned by House Committee

Republicans in the U.S. House Committee on Financial Services

Requested from the SEC all records and papers pertaining to the FTX investigation.

In a recent development regarding the US SEC's investigation into the FTX collapse, Republicans on the US House Committee on Financial Services expressed grave reservations about the manner in which the situation was handled. The committee chairman Patrick McHenry requested all records and conversations from the SEC regarding the continuing inquiry, which may be seen as a major criticism of Gary Gensler's organisation. The chairman remarked, "The American people transparency from you and your agency." The records were requested to be submitted in two weeks by the head of the House committee.

Timing of FTX Probe

In a letter to the SEC Chair, Chairman McHenry stated that this opinion was based on the timing of the accusations and Sam Bankman-detention. The letter also mentioned that, in accordance with US law, the financial services committee has the authority to monitor the SEC's operations. As a result, the SEC was asked to turn over any documents and correspondence pertaining to the accusations against FTX co-founder Sam Bankman-Fried since November 2022, when FTX's liquidity problems were discovered. Also sought were communications from Gensler's office during that time period.

His arrest and the timing of the accusations cast considerable doubt on the SEC's procedures and cooperation with the Department of Justice.

A day before the Committee's hearing on the FTX collapse, on December 12, 2022, the Bahamas authorities detained Bankman-Fried. The SEC had issued accusations against the co-founder of FTX on the same day, citing "concealing his theft of FTX customer monies." The committee is worried about the timing of the SEC's accusations, which came after the arrest.