Regulation
Jay Clayton, Chairman of the SEC Set to Resign at End of 2020
The Securities and Exchange Commission (SEC) operates under the charge of 5 commissioners – with one of these being elected by the President of the United States (POTUS) to act as Chairman. For the past 3.5years, this top role at the SEC has been occupied by Jay Clayton. This is about this change, however, as Clayton has just announced his impending resignation.
Enforcement Highlights
Despite only acting as SEC Chairman for 3.5years, this stint represents one of the longest in the history of the SEC.
This period was highlighted by significant enforcement actions taken under Clayton’s watch. The following statistics are shared by the SEC, demonstrating this.
- brought over 2,750 enforcement actions,
- obtained more than $14 billion in financial remedies,
- distributed approximately $3.5 billion to harmed investors, and
- paid awards of approximately $565 million to whistleblowers.
Eventful
When you are in the position of enforcing rules, and holding bad actors accountable for their actions, there is no way to please everyone. Jay Clayton has been no different during his time as SEC Chairman.
One thing that is not in question, is that Jay Clayton was able to find a way to navigate through various unprecedented events over the past few years. Two events in particular stand out – the rise of crypto, and COVID-19.
Despite what sometimes feels like a painfully slow pace, the SEC has, at the end of the day, been quite open to the rise of cryptocurrencies. Yes, the denial of a Bitcoin ETF may sting, but quite frankly, crypto markets at the time were rife with scams of criminals. Only now is this beginning to abate, as institutional investors make their entrance into the sector.
All while navigating these aforementioned hurdles, the SEC has made notable strides forward in its approach towards crowdfunding, amendments to existing frameworks, and redefining what it means to be an investor.
No Surprises Here
For those that follow developments pertaining to the SEC, this announcement will most likely not come as a surprise – for two reasons in particular.
- Roughly 5 months ago, news broke that high ranking officials in the Trump administration had intended on nominating Clayton for the role as the U.S. Attorney for Southern New York – a move that would necessitate resigning from the SEC.
- As the position of Chairman at the SEC is appointed by the President’s administration, it is commonplace for the position to be vacated when a change in office occurs – such as the upcoming transition to Joe Biden.
A Successor
With news of Clayton’s departure, the next question on people’s minds is no doubt – who will succeed him in the position?
A prime candidate would be affectionately titled Hester ‘Crypto-Mom’ Peirce. As an acting Commissioner at the SEC, Peirce has developed a large group of supporters due to her open-mindedness towards the regulations of forward-thinking technologies like blockchain. Furthermore, she was also recently re-elected to a second term at the SEC on August 6th, 2020, by the U.S. Senate.
Simply put, Commissioner Peirce is experienced in a lead role at the SEC, is well-liked, and will be around for a while longer. While not the only potential candidate for Chairman, the shoe would most likely fit if the next administration decided to try it on.
Securities and Exchange Commission
The Securities and Exchange Commission is a U.S. based regulatory body, tasked with ensuring fair and transparent markets. This is done through the creation, and enforcement, of various laws surrounding the usage of securities.
Chairman, Jay Clayton, currently oversees operations at the SEC.
