- The SEC’s Inspector General Nicholas Padilla resign after criticizing Chairman Gary Gensler’s authority.
- Acting IG Padilla raised concerns with Gensler since September.
- October report reflected that SEC managers were not notified of policy changes.
The SEC’s Acting Inspector General Nicholas Padilla has resigned less than two months after issuing a report harshly criticizing Chairman Gary Gensler’s approach to rulemaking. The IG claimed it was hurried and potentially harmful to the agency’s workers and overall health.
According to the study, numerous top managers were not even aware of major changes in department policy until they were implemented in December 2021.
According to an SEC spokesperson, the departure of Nicholas Padilla, who took over earlier this year, is unrelated to the activities of his office.
SEC Chair Gary Gensler recently refuted criticism that the agency failed to enforce rules preventing misconduct by cryptocurrency firms, such as the unlawful trading that led to the demise of crypto exchange giant FTX.
Gensler said in an interview that the SEC has brought more than 100 enforcement cases in the crypto space, directly challenging lawmakers’ questions about the agency’s oversight.
In November, Senator Elizabeth Warren of Massachusetts called on the SEC to “suit up” following FTX’s failure, arguing the agency has “fallen behind” the crypto industry. The House of Financial Services Committee also enquired Gensler about what he knew leading up to FTX’s collapse.
“We’re already suited up,” Gensler replied. In his statement, the SEC chief said cryptocurrency firms should be held responsible for compliance with existing regulations. However, Bankman-Fried has denied committing fraud.
Similarly, not too long ago, journalist Eleanor Terrett reported that the Commodity Futures Trading Commission (CFTC) was one of the worst workplaces during Gary Gensler’s tenure.
According to the federal watchdog, the CFTC staff was constantly under pressure as they worked to execute Gensler’s ambitious overhaul of Wall Street laws.
In a report to Congress earlier this year, the Inspector General’s office stated that it would complete its audit by the end of September. There has been no publication of the report, and the SEC has declined to comment on the delay and has not replied to multiple Freedom of Information Act requests for information about its release.