Republicans Introduces New Bill to Remove SEC Chair from Office

On Monday, US House of Representatives members introduced a new bill to remove the chair of the Securities and Exchange Commission (SEC), Gary Gensler, from office.  A representative from Ohio, Warren Davidson, and the majority whip Tom Emmer presented the Bill Stabilization Act.

Under the new bill, the policymakers outlined key elements crucial for restructuring the SEC.  In his presentation, Davidson accused Gensler of misuse of office.  He lamented that during Gensler’s regime, the SEC misused their powers.

Scope of the Stabilization Act

Davidson urged the policy makers to safeguard the capital markets from Gensler.  He confessed that the Stabilization Act would address the SEC’s misuse of power and provide proactive measures to support the financial sectors in the future.

Davidson emphasized that the SEC required some reforms, which would involve the stepping down of Gensler.  In support of Davidson’s argument, the majority whip Tom Emmer explained the need for clear crypto regulations.  He condemned the SEC regulatory approach, which replicated “political gamesmanship.”

Emmer confirmed that the Stabilization Act would lead to major reforms in the commission structure.  The new bill will ensure that SEC action safeguards the investor’s interest but not Gensler’s motives.  He acknowledged the efforts made by Davidson to restore the operation of the SEC.

The new bill will require the SEC to create an additional position for a sixth commissioner.  Initially, the SEC comprised four commissioners who worked closely with Gensler.

Also, Davidson and Emmer’s bill will require the SEC to apply the division of labour approach to ensure that power is evenly distributed across the organization structure.

The new bill will require the SEC to hire an executive director to control the commission’s daily activities.  Beyond this, the SEC must engage in the rulemaking process for six years.  Primarily the rulemaking process involves conducting research on policies and multiple enforcement approaches.

Importance of Restructuring SEC Operations

The Stabilization Act will minimize political parties’ involvement in the commission’s operation.  According to Davidson’s proposal, the SEC must implement a structure corresponding to the Federal Election Commission (FEC).

The new bill has created heated exchanges among the legal team in the US.  A law practitioner’s report revealed that removing Gensler from office required some legal causes.  Citing the 2010 Supreme Court ruling, the lawyer noted that the president had limited power to force Gensler to leave office.

He stated that if the SEC chair engages in negligence of duty, the president can terminate his contract.  Notably, the president can order cabinet secretaries to leave office.

A few days ago, the Brooklyn representative Byron Donalds questioned the involvement of Gensler in the Steele dossier payment, which Hillary Clinton made.  In 2016 Gensler was the chief financial officer (CFO) of Clinton’s presidential campaigns.

In his statement, Donald demanded Gensler to state whether he was involved in the Steeler Dossier payment in his previous role as the CFO.  Gensler stated that he was unaware of the Steeler dossier payments made in 2016.

Recently, Gensler has accused crypto exchange Binance and Coinbase of violating securities regulations.  The SEC June 5 filing revealed that nineteen crypto assets, including Axie Infinity, Cardano, Polygon, and Solana, among others, were classified as securities.