tl;dr
Two SEC lawyers resigned after a federal judge sanctioned the agency for a "gross abuse of power" in a case against Debt Box, a Utah-based crypto company. The judge expressed concerns about the integrity of the proceedings and ordered the SEC to pay legal costs for Debt Box. The agency admitted to m...
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Two lawyers for the U.S. Securities and Exchange Commission (SEC) resigned after a federal judge sanctioned the agency for a "gross abuse of power" in a case against Debt Box, a Utah-based crypto company.
Michael Welsh, former lead attorney on the Debt Box case, and Joseph Watkins, an investigative attorney, were reportedly forced to step down or face termination.
The SEC admitted to making "materially false and misleading representations" in pursuit of a restraining order, leading to concerns about the integrity of the proceedings. The SEC's Division of Enforcement Director and the agency as a whole issued apologies for their conduct in the case.
In February, five Senate Republicans criticized the SEC's behavior as "unethical and unprofessional."
In March, the federal judge ruled that the SEC had committed a "gross abuse of power" and ordered it to pay legal costs for Debt Box. The case is ongoing.
Summary: Two SEC lawyers resigned after a federal judge sanctioned the agency for a "gross abuse of power" in a case against Debt Box, a Utah-based crypto company. The judge expressed concerns about the integrity of the proceedings and ordered the SEC to pay legal costs for Debt Box. The agency admitted to making false and misleading representations and faced criticism from Senate Republicans for its conduct. The case remains ongoing.
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