A recently released report is accusing certain Congress members of trying to stop government investigations into FTX because they received donations from employees of the crypto exchange.
The American Prospect said the Securities and Exchange Commission (SEC) tried to obtain information about the collapsed company earlier this year, and eight U.S. representatives sent a letter asking if the SEC had the authority to make those inquiries.
“We have questions regarding the Securities and Exchange Commission’s (the Commission) utilization of Division of Enforcement and Division of Examination authorities to obtain information related to cryptocurrency and blockchain firms,” the letter began.
The lawmakers also asked the SEC to answer 13 questions “to help us understand how and why the SEC is soliciting information from private firms related to cryptocurrency and blockchain.”
The group, dubbed the “Blockchain Eight” by the Prospect, was made up of four Democrats and four Republicans, including newly-elected Majority Whip Tom Emmer, a tech and innovation enthusiast.
Reps. Darren Soto, Warren Davidson, Jake Auchincloss, Byron Donalds, Josh Gottheimer, Ted Budd and Ritchie Torres also signed the letter.
“Crypto startups must not be weighed down by extra-jurisdictional and burdensome reporting requirements,” Emmer said in a statement about the letter. “The SEC must ensure that its information-seeking requests to private crypto and blockchain firms are not overburdensome, unnecessary, and do not stifle innovation.”
He reiterated the sentiment in a tweet on March 16, the same day the letter was dated.
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“My office has received numerous tips from crypto and blockchain firms that SEC Chair @GaryGensler’s information reporting ‘requests’ to the crypto community are overburdensome, don’t feel particularly… voluntary… and are stifling innovation,” Emmer tweeted.
According to a summary of the Prospect’s reporting by Unusual Whales, “five of the eight members received campaign donations from FTX employees, ranging from $2,900 to $11,600. Rep. Ted Budd (R-NC), one of the signatories, received half a million dollars in support from a Super PAC created by FTX co-CEO Ryan Salame.”
The National Republican Congressional Committee also received $2.75 million from FTX in the 2022 cycle; $2 million from Salame in late September, and $750,000 from the company’s political action committee, the report continues.
In a recent interview with Fox Business, Emmer said FTX didn’t fail because of crypto, but it did so because of bad actors and unscrupulous business practices.
The SEC declined to comment and six of the eight representatives have not responded to the Prospect’s requests, the report states.
PHOTO: The FTX Arena name is still visible where the Miami Heat basketball team plays Saturday, Nov. 12, 2022, in Miami. Lawyers for FTX disclosed Tuesday that a “substantial amount” of assets have been stolen from the accounts of the collapsed cryptocurrency exchange, diminishing the odds that its millions of investors will get their money back. (AP Photo/Marta Lavandier, File)