House committee chair warns SEC chair of potential subpoena, excluding crypto matters.

James Comer, the chair of the United States House of Representatives Oversight and Accountability Committee, has issued a threat to Securities and Exchange Commission (SEC) chair Gary Gensler. In a letter dated October 12, Comer made it clear that if the SEC does not start cooperating with the committee, they will have no choice but to use compulsory measures, including a subpoena, to obtain the necessary documents. The concern expressed by Comer revolves around the SEC’s alleged actions to circumvent Congress in order to further an agenda that could potentially harm American taxpayers. It is worth noting that this particular letter does not pertain to the cryptocurrency industry but rather focuses on the coordination between the SEC and the European Union (EU) regarding environmental, social, and governance (ESG) and climate-related issues, as well as the SEC’s lack of cooperation.

This is not the first time that criticism has been directed towards Gensler by cryptocurrency proponents in Congress. However, in this instance, the letter from Comer and Senator Tim Scott, who is currently running in the Republican presidential primary, specifically focuses on the United States’ collaboration with the EU on climate legislation that could potentially impact American companies. Both Comer and Scott had previously written to Gensler in June requesting information on this matter, and they also sent a similar letter to Treasury Secretary Janet Yellen. In Comer’s most recent letter, he expressed disappointment with the SEC’s lack of substantive documents and highlighted that the majority of the documents provided were publicly available on the SEC’s website or had already been released under the Freedom of Information Act.

Interestingly, Comer’s remarks in his letter parallel those of Patrick McHenry, who had previously written to Gensler on April 12. In that letter, McHenry commented on the documents provided by the SEC in response to his request, stating that they were publicly available and not directly responsive to his inquiry. McHenry, who serves as the chair of the House Financial Services Committee, had sought information regarding the prosecution of former FTX CEO Sam Bankman-Fried and also issued a threat of “compulsory process” to Gensler. Notably, McHenry reiterated this threat during a House Financial Services Committee hearing.

Comer’s use of the phrase “it is not clear that the law provides such authority, and we must determine whether legislation is necessary” resonates with crypto supporters who often question the extent of the SEC’s authority in the industry. In his initial letter, Comer reminded Gensler of the Supreme Court’s West Virginia v. EPA ruling, which addressed the major questions doctrine and its potential implications on the SEC’s activities in the cryptocurrency sphere.

While this latest development primarily focuses on the SEC’s cooperation with the EU on climate issues, it highlights the ongoing tension between regulators and crypto proponents in Congress. As the SEC faces scrutiny and potential subpoenas, the industry eagerly watches to see how these conflicts will unfold and how they could impact the future of cryptocurrency regulation in the United States.

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