McHenry to SEC Commissioners: Chair Gensler’s Legacy Will Be Defined by Turning the Once Proud Institution of the SEC Into a Rogue Agency
Washington,
September 24, 2024 -
Today, the House Financial Services Committee, led by Chairman Patrick McHenry (NC-10), is holding a hearing to conduct oversight of the Securities and Exchange Commission with testimony from all five Commissioners.
This is the first time since 2019 that all five Commissioners have testified together before the Committee, providing a unique opportunity to hear the diverse viewpoints of the full Commission. Republicans will highlight how Chair Gary Gensler’s SEC has become a rogue agency that routinely exploits its authority to the detriment of U.S. capital markets, innovation, and the American people.
Watch Chairman McHenry’s opening remarks here.
Read Chairman McHenry’s opening remarks as prepared for delivery:
“Today’s hearing is to conduct oversight of the Securities and Exchange Commission.
“Based on recent actions taken by Chairman Gensler, it’s easy to forget that the SEC is independent and led by a bipartisan commission.
“It’s not solely run by the Chair or a single agency head. That’s why it’s so critical for Congress and the American people to hear the diverse viewpoints of the full Commission.
“Today, all five Commissioners are testifying before our committee for the first time since 2019. A lot has changed since then in our markets, the broader economy, and at the SEC itself—unfortunately, not for the better.
“Under Chair Gensler, the SEC has become a rogue agency. It routinely exploits its authority to the detriment of our capital markets, innovation, and the American people.
“Chair Gensler recently said, ‘we at the SEC live within the laws as Congress passes them.’
“Nothing could be further from the truth. Don’t just take my word for it. A wide array of federal judges—appointed by Presidents from both parties—have noted the lawless nature of Chair Gensler’s tenure by overturning rulemakings and enforcement actions.
“This includes the proxy advisory rule, the private fund disclosure rule, the stock buyback rule, Debt Box, Grayscale, Ripple, and the list goes on.
“It’s not just the courts that have taken issue with Chair Gensler’s reckless agenda. More than 250 Members of Congress from both parties have signed dozens of letters opposing actions taken by the SEC.
“Chair Gensler has proposed a slew of major, interconnected rules that exceed the SEC’s statutory authority—often with inadequate justification, economic analysis, and public engagement.
“But what stands out in this massive rulemaking agenda is the fact that Chair Gensler has failed to propose a single rule focused exclusively on facilitating capital formation—a key pillar of the Commission's statutory mission.
“This is in stark contrast to our committee. We’ve passed more than twenty bipartisan bills through the House to strengthen public markets, help small businesses access capital, and increase opportunities for all investors. Let me repeat—bipartisan bills.
“It appears only at Chair Gensler’s SEC is capital formation a partisan priority. And that’s not the only area this SEC has ignored the bipartisan consensus of Americans’ elected representatives.
“In May, the House passed FIT21 to create clear rules of the road and provide robust consumer protections in the digital asset ecosystem.
“More than two thirds of the House—including 71 Democrats—rejected Chair Gensler’s approach to digital assets by supporting FIT21.
“Yet, true to form, Chair Gensler has doubled down on regulation by enforcement.
“Without the regulatory clarity and consumer protections in FIT21, the United States will continue to fall behind Europe in technological innovation and adoption. This is unheard of in modern history.
“Bipartisan opposition in Congress, continued rejection by the courts, and notably, the end of Chevron Deference should serve as a warning to Chair Gensler.
“Whether it’s digital assets or climate policy, the SEC cannot unilaterally expand its authority.
“With a record like this, it’s clear Chair Gensler’s legacy will be defined by turning the once proud institution of the SEC into a rogue agency.
“I yield back.”
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