Gary Gensler’s Vanishing Messages Trigger Republican Inquiry

Former Securities And Exchange Commission Chair Gary Gensler lost nearly a year of text messages after an automated IT action a federal review ￰0￱ to a special review by the SEC’s Office of Inspector General information technology staff triggered an automated “enterprise wipe” that erased text messages sent and received on Gary Gensler’s government phone between October 18 2022

and September 6 ￰1￱ review says the device had not been backed up during that interval and routine alerts and change controls were missed or ￰2￱ Gensler & The Missing Text: Inspector General’s Findings The OIG report found the wipe resulted from a poorly understood automated policy put in place by the SEC’s Office of Information Technology in August ￰3￱ on the review the wipe was avoidable and was compounded by weak change management

failures to act on vendor software flaws and a lack of timely backups — gaps that left key messages ￰4￱ report lists recommendations and said agency management has responded with corrective ￰5￱ See A Double Standard House Republican leaders are pressing the SEC for ￰6￱ on reports from the House Financial Services Committee Republican chairmen have written to SEC Chair Paul Atkins seeking details about how the loss happened what records were affected

and whether the agency’s recordkeeping met federal ￰7￱ point out that in fiscal year 2023 the SEC obtained more than $400 million in penalties tied to recordkeeping and off-channel communications by firms and say the agency itself must meet the same standard it enforced on ￰8￱ And Legal Stakes The missing messages overlap with a busy year of enforcement actions and policy talks at the ￰9￱ have disclosed that some deleted texts involved enforcement work tied to crypto cases and other high-profile matters which could matter to litigants and to records requests under the Freedom of Information Act or ￰10￱ the industry

critics point to Gary Gensler as instrumental in an alleged Biden administration campaign to nudge banks into restricting services to crypto companies and they charge that the SEC under his watch weakened the sector by bringing several ￰11￱ The Agency Has Said And What’s Next The SEC’s OIT and agency leadership have acknowledged the failures flagged by the OIG and have described steps to fix system controls and backup ￰12￱ House committee’s letter asks for a full account and timelines and signals lawmakers may follow up with additional oversight or ￰13￱ now investigators and agency officials are focused on closing the technical gaps the report ￰14￱ image from Getty Images

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