Feds Giddy Up on FinTech: SEC Adds 20 Positions to Cryptocurrency Unit
The SEC announced on May 3, 2022 that 20 additional positions will be allocated to the Crypto Assets and Cyber Unit within the Division of Enforcement. The announcement specifically identified crypto asset offerings, crypto asset exchanges, crypto asset lending and staking products, decentralized finance (“DeFi”) platforms, non-fungible tokens (“NFTs”), and stablecoins as among the markets under investigatory scrutiny by the expanded Crypto Assets and Cyber Unit for potential securities law violations. The increase in resources will nearly double the size of the unit (now at 50 dedicated positions), which until recently was known as the “Cyber Unit.” According to the SEC, the increase in personnel will occur at multiple levels, including “supervisors, investigative staff attorneys, trial counsels, and fraud analysts in the agency’s headquarters in Washington, DC, as well as several regional offices.”
The SEC’s changes – both the increase in personnel and the renaming of the unit – are consistent with the SEC’s recently announced 2022 Examination Priorities, which includes crypto assets. The announcement also comes on the heels of the FBI forming a new unit dedicated to cryptocurrency-related investigations, the Virtual Asset Exploitation Unit, and the DOJ creating a new team within the Criminal Division, the National Cryptocurrency Enforcement Team. Cryptocurrency-related investigations continue to increase and announcements like the SEC’s will only increase those numbers.