SEC Chair's ties with FTX at heightened risk of SEC subpoena

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SEC Chair's ties with FTX at heightened risk of SEC subpoena

As the trial of Sam Bankman-Fried's fraud trial heats up, Gary Gensler's alleged cozy ties with the fallen cryptocurrency kingpin is at a heightened risk.

The chairman of the SEC has received a subpoena threat from US Rep. Patrick McHenry, chair of the House Financial Services Committee, who is demanding more information on the FTX collapse.

At a hearing Sept. 27, Mr. McHenry told Gensler.

In addition to his role in the cryptocurrency exchange's downfall, Gensler has maintained a tight-lipped outlook on his role.

At the hearing with McHenry last week the SEC chair said he would only say his staff would continue to work with McHenry's on the matter before being repeatedly cut off by the Congressman.

One big concern is that Gensler has ties to FTX.

Glenn Ellison, the father of Alameda Research CEO Caroline Ellison, SBF's ex-girlfriend who has since turnedinformer to the feds, was the head of the economics department at MIT in 2018, when Gensler taught a course on blockchain there in 2018.

In addition, several of Gensler's old cronies were working for FTX and were even responsible for arranging meetings between Gensler and SBF, sources said.

Ryne Miller, who a decade earlier had served as legal counsel to Gary Gensler, while Gensler headed the Commodity Futures Trading Commission, joined FTX as its general counsel in August 2021.

After he joined FTX, Bankman-Fried nabbed his first meeting with Gensler in October 2021, according to a screenshot of Gensler's calendar.

SEC documents show that Miller arranged a conversation between Gensler, Bankman-Fried, and FTX US President Brett Harrison to discuss next steps for the exchange and how it could be legitimized.

It wasn't just Gensler that was wooed by FTX. In October 2021, the GEC's general counsel Dan Berkovitz went to dinner at an upscale Indian restaurant in Washington, Rasika West End, with Bankman-Fried and Miller.

A co-chairman of the CFTC and a former commissioner of the agency, Mark Wetjen, who served in the same capacity, also joined the dinner.

While it's unclear what was discussed at the meal, Wetjen joined FTX as the head of policy and regulatory strategy for the US.

On The Money, Thomas Jones, the president of the American Accountability Foundation, said.

Wetjen, who has remained close to Gensler, also was responsible for setting up a Zoom call just eight months before the exchange's ultimate downfall, according to reports.

Bankman-Fried discussed the possibility of launching a new cryptocurrency trading platform with Brad Katsuyama's IEX on the call.

SEC insiders say it is highly unusual for an SEC Chair to discuss a work-in-progress.

The SBF bragged about having access to Gensler.

Jones said the president's words were a remembrance for those who lost their lives in World War II.