Ripple Executive Flags Gary Gensler’s Speech, Highlights SEC’s Shortcomings

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David Pokima

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David Pokima

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David is a finance journalist and a contributor to Cryptonews.com with a keen interest in breaking comprehensive, accurate, and reliable blockchain news.

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November 17, 2023

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Ripple’s Chief Legal Officer Stuart Alderoty has pointed out loopholes in Gary Gensler’s speech at the 2023 Securities Enforcement Forum referring to the Securities and Exchange Commission’s (SEC) “shady” behavior.

In a social media post on X (formerly Twitter), the Ripple executive replying to the SEC boss said the Commission is losing international relevance following recent developments that have seen it suffer defeats in high-profile cases.

“The SEC is losing in court; being criticized by Judges for shady behavior; being rebuked by the Gov’t’s internal auditor; hiding info about meetings with a felon; becoming irrelevant on the international stage. Gensler – admitting no fault – has become the insulate Col. Jessep”

Alderoty noted that Gensler needed to be fact-checked after the video showed him saying the SEC will not prejudge companies. According to many within crypto circles, the Commission prejudged Ripple alongside others who were sued without proper investigations.

Similarly, pro-XRP lawyer John Deaton has also criticized the SEC approach toward the industry adding that Col. Jessep was way more likable than the SEC. The video shared by Gensler continued to spark reactions from the community leading to more scrutiny of Gensler’s enforcement approach.

Wider community reacts

Erik Voorhees, the CEO of ShapeShift added that the SEC’s claims of not being prosecutors of honest business are false as they have come after his honest company twice.

"We are not prosecutors of honest business"

You've literally prosecuted my honest businesses… twice now.

— Erik Voorhees (@ErikVoorhees) November 17, 2023

Others accused the SEC of reducing investor confidence with a harsh policy that has spelled doom for the sector in recent years forcing many firms out of the country.

“In effect, it is there to merely dampen the grievances of retail traders, preventing them from mobilizing or posing significant challenges to the system, which would disturb the status quo that benefits the owners of the SEC,” “userofintellect” argued on X.

Gensler’s controversial address

Last month, Gensler addressed the Securities Enforcement Forum explaining their achievements in recent months and commitment to keep investors safe.

The controversy came when he quoted a speech by Joseph Kennedy adding, “We are not prosecutors of honest business, nor defenders of crookedness. We are partners of honest business and prosecutors of dishonesty. We shall not prejudge, but we shall investigate.” 

While several crypto-related executives disagree with this position, Gensler listed several wins recorded this year including recovering $5 billion in judgment orders from over 750 enforcement actions.

💰💸 SEC’s FY 2023 Enforcement Actions Yield $5 Billion in Fines from Wall Street and Crypto Giants

The US #SEC has announced that its enforcement actions in fiscal year 2023 resulted in nearly $5 billion in fines and reimbursements to investors.https://t.co/jFw5A2JoZ9

— Cryptonews.com (@cryptonews) November 15, 2023

The Commission has distributed $930 million to harmed investors as a result of the activities of bad actors. He further called for more market scrutiny and more regulations to protect investors in the crypto market.

“This is a field rife with fraud, scams, bankruptcies, and money laundering. While many entities in this space claim they operate beyond the reach of regulations issued before Satoshi Nakamoto’s famous white paper…”