SEC Gensler says we will not prejudge

Gary Gensler, chairman of the Securities and Exchange Commission (SEC) was forthright in a speech, saying that the SEC is not a prosecutor of honest business, and neither will it prejudge.

Gensler quotes from the past

Chair Gensler was addressing the 2023 Securities Enforcement Forum on Thursday, and he held up some of the SEC chairmen from past times, and what they said, as where he himself got some of his inspiration from.

As Joseph P. Kennedy, the first @SECGov Chair, once said: “We are not prosecutors of honest business, nor defenders of crookedness. We are partners of honest business & prosecutors of dishonesty. We shall not prejudge, but we shall investigate.” Check out my recent remarks: pic.twitter.com/QM2zqj8PQs

— Gary Gensler (@GaryGensler) November 16, 2023

Joe Kennedy was mentioned in his speech as someone who particularly inspired him, who said the following:

“The Commission will make war without quarter on any who sell securities by fraud or misrepresentation.” 

Gensler might have been taking a dig against certain crypto companies with these words. Gensler went on to quote some more lines by Kennedy which he made a few months later. He said:

“We are not prosecutors of honest business, nor defenders of crookedness. We are partners of honest business & prosecutors of dishonesty. We shall not prejudge, but we shall investigate.”

The Gensler tenure

Gensler would probably really like those in the audience and those who saw this particular speech clip to think that this quote applied to himself and to his tenure at the SEC. He has received quite some backlash from the public and from the courts as to how he has handled some cases, so some positive exposure would likely be welcomed.

However, using quotes from the SEC’s revered chairmen from the past is not likely to be able to gloss over this present chairman’s inadequacies. Having had his knuckles firmly rapped by the courts over the Ripple and Grayscale cases has gone to show that he cannot use his ‘regulation by enforcement’ strategy to simply bulldoze over all crypto businesses.

By generally picking on the more legitimate and compliant businesses such as Coinbase, Grayscale, and Paxos, Gensler has shown himself to have prejudged crypto practically in its entirety.

In addition, for Hester Peirce, one of the five SEC commissioners, to feel obliged to regularly dissent and protest against some of the SEC crypto enforcements, and to state that there is really no way that any crypto company can register with the SEC, speaks volumes for the way Gensler currently leads the US securities watchdog.

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