The alleged change, which would require SEC attorneys to obtain the approval of the commission as a whole, is part of the institution’s new directives aimed at increasing the efficiency of its probes and actions.
SEC Allegedly Changing Modus Operandi: Formal Probes Would Need Prior Approval
The U.S. Securities and Exchange Commission (SEC) is changing its modus operandi regarding how the agency manages and conducts formal probes. According to two sources quoted by Reuters, now attorneys have to have prior approval of the commissioners, a requirement not enforced before.
This change in how procedures are carried out might delay conducting legal probes, as the agency attorneys would have to seek this permission beforehand, a responsibility that fell under the duties of middle-rank officials before.
However, it is unclear if there has been a formal vote to change these procedures, or if the course of action was just changed, according to Reuters. Nonetheless, if these investigations are conducted informally, attorneys are still allowed to inquire in several cases. For any inquiry involving formal procedures, like subpoenaing documents and sources, these new rules would apply.
These procedures come as the SEC has pivoted to be more crypto-friendly, repealing the Staff Account Bulletin 121 (SAB 121) and allowing traditional finance institutions to offer crypto custody services. The modifications had been predicted by insiders before, who stated that the commission would examine dropping several high-tier crypto cases, while still maintaining a hard-edge approach to crypto fraud.
Read more: SEC Repeals SAB 121, Opening the Floodgates for Banks to Enter the Crypto Market
The SEC is now under the guidance of Mark T. Uyeda, appointed by President Donald Trump as acting chairman on January 21, a pro-crypto commissioner who has served in the agency since 2022. This policy might be a direct result of Trump’s influence, who has criticized the inefficiency and excessive spending of government offices, and also the chase on crypto companies.
Read more: Trump Appoints Crypto-Friendly Acting SEC Chair, Signaling Regulatory Shift
Uyeda has been a critic of the SEC’s stance on crypto assets, rejecting the “regulation by enforcement” practices of former SEC Chair Gary Gensler, who commonly referred to crypto markets as the “Wild West.”
