Gushiken Yona
The U.S. Securities and Exchange Commission (SEC) announced a record $8.2 billion in fines and penalties for fiscal year 2024, its highest ever, just as Chairman Gary Gensler prepares to depart the agency in January 2025.
This record sum revealed in the SEC’s Nov. 22 annual report, highlighted an aggressive enforcement strategy under Gensler’s leadership. Over half stems from a single $4.47 billion settlement with Terraform Labs and its former CEO Do Kwon, following fraud charges related to the 2022 collapse of their blockchain ecosystem.
Significantly, without this landmark settlement, the SEC’s 2024 collections would have been their lowest since 2013, totaling just $3.72 billion. The $8.2 billion includes $2.1 billion in penalties and a record $6.1 billion in disgorgement—returning ill-gotten gains to investors.
Gensler, who said he would step down on Jan. 20, 2025, said, “The Division of Enforcement is a steadfast cop on the beat…holding wrongdoers accountable.” His tenure saw a crackdown on cryptocurrency companies, with enforcement actions peaking at 46 cases in 2023. While crypto-related cases decreased to 11 in 2024, associated penalties increased by over 3,000% due to the Terraform settlement.
However, Acting Enforcement Director Sanjay Wadhwa argued that the total fines collected don’t fully represent the commission’s impact. “Beyond the $8.2 billion,” Wadhwa explained, “our proactive investigations…are driving a significant shift toward compliance.”
He highlighted the ripple effect of SEC investigations, noting that even cases not resulting in formal charges often prompt companies to improve their compliance efforts. This proactive approach, Wadhwa argues, is crucial for investor protection and maintaining market integrity, ultimately building trust in capital markets.
The incoming Trump administration, with its indicated move towards easing enforcement in the digital asset space, has fueled anticipation of a regulatory shift. Teresa Goody Guillen, a rumored candidate for SEC Chair, echoed this sentiment, calling for less aggressive regulation and greater engagement with the crypto industry. She advocated for clearer rules and an end to “regulation by enforcement,” arguing that it stifles innovation.
Beyond financial penalties, the SEC barred 124 individuals from serving as officers and directors of public companies – the second-highest number in a decade – and returned $345 million directly to harmed investors as part of the over $2.7 billion returned since 2021. A record 45,130 tips, complaints, and referrals (including 24,000 from whistleblowers) led to $255 million in whistleblower awards, signaling increased public scrutiny of financial misconduct and bolstering the SEC’s enforcement capabilities.
Read More
- Trump’s Reported SEC Pick Could Be Teresa Goody Guillén
- Trump Just Put Shiba Inu on Everyone’s Radar: What Happens Next?
- South Korea Tightens Grip on Crypto: Exchanges Gain Freeze Power, City Seizes Assets for Taxes
Yona has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Daily is an official media and publication of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
