SEC to Close Salt Lake Office Following Legal Setback in Crypto Lawsuit
Summary:
Following an order by a federal judge to pay nearly $1.8 million in legal and receivership fees, the U.S. Securities and Exchange Commission (SEC) is set to close its Salt Lake Regional Office in 2024. The decision came after the SEC's lawsuit against crypto company DEBT Box was dismissed. The SEC also faces ongoing litigation with several other crypto firms, including Coinbase, Binance, Kraken, and Ripple.
After being ordered to settle roughly $1.8 million in legal and receivership fees by a federal judge, the U.S. Securities and Exchange Commission (SEC) has announced its decision to shutter one of its eleven regional branches. The Salt Lake Regional Office, scheduled for closure in 2024, is suffering from a significant decline in staff and its operations are set to be transferred to Denver. The decision came in the wake of Judge Robert Shelby dismissing the SEC's lawsuit against Digital Licensing, a company operating under the name DEBT Box, and insisting the SEC pay around $1 million for attorney costs and an additional $750,000 receiver costs.
The lawsuit was filed against DEBT Box by the SEC in July 2023, accusing the company of orchestrating an unauthorized $50 million cryptocurrency operation. Nevertheless, in March, Judge Shelby identified 'bad faith conduct' by the SEC concerning a temporary injunction to halt the assets of DEBT Box. Due to these actions, the SEC faced sanctions, including covering all legal fees and costs that resulted from the hastily implemented ex parte injunction.
Two SEC attorneys at the Salt Lake Regional Office reportedly exited their roles in relation to the case management, but it is unclear whether these retirements were a factor in the significant staff reduction cited by the commission. A request for comment to DEBT Box has yielded no response by publication time.
"Is 'Attrition' the term we are now using to describe the unparalleled deceit and lack of faith that merited a remarkable sanction by a federal judge?" said Paul Grewal, Chief Legal Officer of Coinbase, in a post on June 4. The SEC maintains ongoing litigation against various cryptocurrency companies, including names like Coinbase, Binance, Kraken and Ripple. In May, a preliminary settlement was announced in the case against Terraform Labs and its co-founder Do Kwon by their legal representatives
Published At
6/4/2024 11:45:59 PM
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