Several progressive lawmakers want to know if and how financial regulators will cut down on their staff leaving to join crypto industry firms.
"We write seeking information about the steps your agency is taking to stop the revolving door between our financial regulatory agencies and the cryptocurrency (crypto) industry," one of the Oct. 24 letters to various financial agencies and government offices reads. The inquiries were organized by Sen. Elizabeth Warren, D-Mass. and Rep. Alexandria Ocasio-Cortez, D-N.Y. "The crypto sector has rapidly escalated its lobbying efforts in recent months, spending millions in an attempt to secure favorable regulatory outcomes as Congress and federal agencies work to craft and enforce rules to regulate this multi-trillion dollar industry."
Joining the letter were Reps. Jesús “Chuy” García, D-Ill., Rashida Tlaib, D-Mich., and Sen. Sheldon Whitehouse, D-R.I.
The group sent the letters, which include requests for information on each agencies ethics rules around officials joining private sector firms with interests at the department or regulator they left. Letters requesting a response by Nov. 7 went to the leaders of the Treasury Department, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Reserve, the Federal Deposit Insurance Commission, the Office of the Comptroller of the Currency and the Consumer Financial Protection Bureau.
According to the lawmakers, over 200 government officials have left to join the digital asset sector in some capacity, ranging from, "advisers, board members, investors, lobbyists, legal counsel, or in-house executives." Citing data from an organization called the Tech Transparency Project, they include 31 Treasury officials, 28 SEC officials, 15 CFTC officials, six Fed officials, five OCC officials, three CFPB officials and two FDIC officials in that tally. Their list also includes eight former members of Congress, 79 former congressional staffers, and 32 former White House officials.
"Americans should be confident that regulators are working on behalf of the public, rather than auditioning for a high-paid lobbying job upon leaving government service," the lawmakers write. "The rapidly spinning revolving door out of government and into the crypto sector, however, undermines both imperatives."
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