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The US Securities and Exchange Commission (SEC) announced today that it will nearly double down on the Cyber and Crypto Assets Unit to step up the fight against cryptocurrency fraud to protect investors from “cyber-related threats.”
The SEC says it will add an additional 20 positions to the cyber team (including supervisors, investigative staff attorneys, trial attorneys and fraud analysts) to expand it to 50 employees focused on combating crypto-based cybercrime.
“By nearly doubling the size of this key unit, the SEC will be better equipped to police irregularities in the crypto markets while continuing to identify disclosure and enforcement issues regarding cybersecurity,” SEC Chairman Gary Gensle said in a statement. statement issued today.
Since its inception in 2017, the SEC’s Division of Enforcement cyber team has combated and investigated cyber threats targeting retail investors (individuals who invest in securities through third parties, such as brokerage firms).
So far, SEC crypto cops have “initiated more than 80 enforcement actions related to fraudulent and unregistered crypto asset offerings and platforms, resulting in monetary relief totaling more than $2 billion.”
This expanded cyber unit will protect those who invest in crypto markets by investigating securities law violations linked to crypto exchanges and multiple crypto products, including but not limited to non-fungible tokens (NFTs), decentralized finance (DeFi) platforms, and stablecoins.
The SEC’s cyber team may also take action against public companies and SEC registrants that do not disclose cybersecurity incidents and do not maintain adequate cybersecurity controls to defend against them.
“The beefed-up crypto and cyber assets unit will be at the forefront of protecting investors and ensuring fair and orderly markets in the face of these critical challenges,” added Gurbir S. Grewal, director of the SEC’s Division of Enforcement.
The SEC also recently proposed rule amendments that require publicly traded companies to report data breaches and cybersecurity incidents within four business days “after they are determined to be a significant incident.”
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