U.S. House committee chairs and the Blockchain Association are pressuring SEC head Gensler.

Three committee chairs in the United States House of Representatives have sent a letter to the chair of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, demanding a more satisfactory response to their letter from November 1 regarding the SEC chairman’s and the agency’s compliance with recordkeeping requirements.

The chairs of the Judiciary Committee, Jim Jordan, the Oversight Committee, James Comer, and the Financial Services Committee, Patrick McHenry, stated that the response they received from Gensler did not address the specific requests made in their letter. Specifically, they asked for certification that the SEC follows federal recordkeeping and transparency rules and that Gensler and his subordinates have not used private email accounts for official business. They also requested explanations of the agency’s definition and use of “off-channel communications.”

The congressmen, along with Representative Tom Emmer, were responding to a Wall Street Journal report that criticized the SEC and other agencies for inadequate recordkeeping. The report concluded that “government officials routinely engage in the same sort of record-keeping shenanigans for which Wall Street groups were recently fined [by the SEC].” The article specifically noted the use of chats by officials for government business, which are not searched to fulfill subsequent Freedom of Information Act (FOIA) requests.

1/ SEC Chair Gary Gensler has wrongly prejudged that all digital assets are securities. As a result, federal law requires that he recuse himself from all enforcement decisions related to digital assets. @MTCoppel and I wrote a paper explaining why https://t.co/xgJ09o4SPS

— Jake Chervinsky (@jchervinsky) June 29, 2023

The new letter reiterates the original requests and adds, “If you do not intend to comply with any or all of the above requests #1-5, describe the factual and legal basis for your noncompliance.” The letter, dated June 28, cited inconsistencies in Gensler’s publicly accessible meeting schedules in 2021, with mention of crypto.

Related: Coinbase seeks dismissal of SEC suit, claims extraordinary abuse of process

Gensler faced crypto-related criticism the following day when the Blockchain Association released a paper arguing that he should recuse himself from digital asset enforcement decisions. The paper claimed:

“In the digital asset space, the SEC has all but abandoned its role as a rulemaking body. Key issues of existential importance to the digital asset industry remain unresolved, chief among them the question of whether and when a digital asset represents a ‘security.'”

The paper cited numerous statements made by Gensler, which showed that he has prejudged all digital assets other than Bitcoin as unregistered securities and all digital asset trading platforms as unregistered securities exchanges. The paper argued that Gensler’s statements demonstrate bias and that due process requires agency decisionmakers to act without bias or the appearance of bias.

The paper also reminded recipients of Wells notices that they can seek Gensler’s recusal through the SEC or in federal court.

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?