SEC to hire more employees to fight digital fraud

The regulator seeks 20 investigators and litigators for its cybersecurity unit

03.05.2022 - 12:35

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What’s new? The US Securities and Exchange Commission (SEC) will increase the number of employees at its dedicated Crypto Assets and Cyber Unit to combat digital fraud, The Wall Street Journal reports. The agency will hire 20 investigators and litigators to oversee “of unregulated $1,7 trillion cryptocurrency market.”

WSJ’s material

SEC representatives’ views on the situation. SEC Chairman Gary Gensler said that the digital asset sector was rife with fraud and abuse, and compared it to the “Wild West.”

“The bolstered Crypto Assets and Cyber Unit will be at the forefront of protecting investors and ensuring fair and orderly markets in the face of these critical challenges,” SEC Enforcement Director Gurbir S. Grewal added.

With the new hires, the unit will comprise 50 people. The SEC’s department deals with the analysis of digital asset exchanges and NFT projects.

What happened before? In April 2022, the SEC added a list of “misleading” companies called Public Alert: Unregistered Soliciting Entities (PAUSE). The entities on the list falsely claim to be licensed in the United States and try to mislead users with names similar to the brands of large companies. PAUSE lists such projects as SuperBinance, Gemini M&A, and FXTstockstraders.

The SEC also proposed that crypto exchanges disclose more information about their clients. The new amendments would require companies to report “significant” cybersecurity incidents, the rules would target investment advisers, investment funds, and business development companies.

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