Lawmakers from the United States House of Representatives have recently introduced a bill aimed at removing Gary Gensler, the current chair of the Securities and Exchange Commission (SEC). However, the legality of removing Gensler from his position may prove to be more complicated than simply passing a piece of legislation.
In June 2021, Ohio Representative Warren Davidson introduced the SEC Stabilization Act with the intention of firing Gensler. The SEC chair, who was sworn into office in April 2021 and is expected to serve until 2026, faces allegations of misconduct and abuse of power. However, removing an independent agency official nominated by the U.S. President and confirmed by the Senate is no easy task.
A 2010 Supreme Court decision ruled that the U.S. President could not remove commissioners except for specific circumstances such as “standard of inefficiency, neglect of duty, or malfeasance.” While U.S. presidents can ask an SEC commissioner to resign or subtly encourage them to step down, they may not have the sole authority to fire one.
Gensler has faced mounting criticism from both the crypto community and some lawmakers, following the SEC’s filing of separate lawsuits against Binance and Coinbase for allegedly offering unregistered securities. The lawsuits include several tokens now considered registered securities, bringing the SEC’s total to around 68 cryptocurrencies.
In response to a tweet from Coinbase‘s legal chief officer, Paul Grewal, Davidson proposed the SEC Stabilization Act in April. If signed into law, this act could restructure the SEC by adding a sixth member and shifting certain authority from the chair to the commissioners.
It remains to be seen whether this legislation will successfully remove Gensler from his position, given the legal complexities surrounding independent agency officials’ removal. As it stands, the crypto community and certain lawmakers will likely continue to scrutinize Gensler’s actions in regulating the space.
Source: Cointelegraph
