Industry Giant Sues SEC for Documents in Crypto Conflicts

• Empower Oversight files a complaint against the SEC for non-compliance with the FOIA request. 

• John Deaton believes that the SEC has corrupt leadership. 

Empower Oversight has filed a complaint against the US Securities and Exchange Commission in the United States District Court for the District of Columbia to force the agency to comply with a December 2022 Freedom of Information Act (FOIA) request. The complaint is about conflicts of interest and selective enforcement by Former senior SEC official William Hinman regarding cryptos like Ripple. 

Hinman has been an important figure in the ongoing Ripple Labs vs SEC lawsuit as documents containing some positions he took about cryptos some years back have been strongly demanded to be made public. In August 2021, a detailed FOIA request was submitted to SEC by Empower Oversight to demand all crypto-related communications between senior SEC officials and their former and future employers. 

According to reports, Hinman received millions of dollars from his former employer Simpson Thacher. Around that time, he was also guiding SEC’s enforcement decisions concerning cryptos. Hinman is known to have said on record that Ethereum is not a security. Interestingly, Thacher is known to be part of the group that promoted the asset. Meanwhile, SEC also declared in enforcement actions that other similar assets are unregistered securities. 

Empower Oversight December 2021 Complaint Against SEC, Ripple pro-Lawyer Comments

Empower Oversight filed a complaint against SEC in December 2021 to force them to provide responsive documents to the FOIA requests.  

Tristan Leavitt, President of Empower Oversight commented:

The SEC’s failure to provide any transparency on this issue is making a bad situation look even worse. We’re approaching two years since Empower Oversight made its initial FOIA request, and a year and a half since our first lawsuit. Yet the SEC has consistently stonewalled any attempts to shed light on these clear conflicts of interest at the agency. This new suit against the SEC should force the SEC to do the searches it knows it must do under the law to give the public the answers we’ve long sought.

In February this year, Forbe’s Roslyn Layton filed a motion with Judge Analisa Torres in the Southern District of New York to gain access to the document containing Hinman’s 2018 speech on cryptos. This was strongly supported by Empower Oversight.

The SEC has consistently stonewalled any attempts from public interest transparency organizations, including Empower Oversight, to shine a light on conflicts of interest and ethical questions at the agency. The public deserves answers from the SEC as to what exactly the agency knew about Hinman’s speech and when they knew it.

This comes at a point the Ripple vs SEC lawsuit is getting to an end. Recently, Ripple CEO Brad Garlinghouse stated that he expects a decision by the court in six months. 

Ripple-pro lawyer John Deaton has responded to Empower Oversight’s complaint, stating that SEC is certainly hiding the truth. While admitting that the SEC has some good people working for them, Deaton believes that the leadership is corrupt. 

Ripple currently has a bullish sentiment and is trading at $0.429 after surging by 0.8 percent in the last 24 hours. 

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