The SEC Doesn't Really Care About Punishing Frauds and Scammers

The SEC doesn't really care about bringing justice to those who commit frauds and scams. We have seen it over and over again where big corporations and the rich are only given a slap on the wrist for their legal transgressions. For instance, recently Kim Kardashian was fined 1.26 million in a settlement over violating securities laws. Now she has net worth of 1.4 billion so the civil penalty is the equivalent of a $90 fine incurred by a median average US family.

Now banks get away with this all the time. Banks commit their quarterly fraud and violations every year, sometimes more than six times a year. In fact, here a lovely list of JP Morgan's violations over the years. They were only charged with three violations this year so far so we're due for at least one more as they haven't yet finished their quota. They were fined around 1 billion a few weeks ago for spoofing the metals market, sometimes they have apparently been doing for over a decade now. And of course, they would have profited much more than 1 billion.

There are many more examples but this goes into my point that the SEC and regulatory agencies don't really care about bringing justice. It's just about the taxes. They make sure to fine you just enough so they look like good guys but the bad actors never really suffer. Its just a slap on the wrist meaning 1. We will be taking our cut now, 2. Don't overdo it next time or at least make sure not to get caught, 3. Thank you for your taxes. We will do business again.

And of course rarely do any of these people face jail time if ever. All the SEC cares about is taking their cut. Now if you're poor, we you have to go straight to jail buddy. You either give them their cut or you're given some time behind bars. Why would the SEC even accept settlements from these rich criminals all the time if they really care about proper and fair enforcement on the law.

In the best case and most optimistic scenario you could (wrongly) argue that the SEC is all about saving taxpayer dollars and resources on fighting cases against the rich with well-funded lawyers who will drag it out and make winning the case difficult. But then we see ridiculous cases like the SEC's legal assault on Ripple, which must have easily racked up millions of taxpayer dollars by now. Many substantiated claims and reports have come out about the SEC's assault on exchange and their very inconsistent and vague application and interpretation of securities laws.

Now we are seeing a trend. The largest BTC fund, Greyscale has also been embattled in a case against the SEC over their refusal to approve a true bitcoin ETF, where trades are settled in actual bitcoin as opposed to cash or a non-futures ETF. Coinbase has filed an amicus brief to support Greyscale in this same lawsuit. Kraken have also stated that they have no plans of SEC registration or token delisting as they list no tokens that could be considered securities. This is despite calls from SEC chair Gary Gensler for crypto platforms to register. We also apparently see the SEC seemingly actually going after real scams and frauds instead of just hindering good companies in their business pursuits. It seems they are already seeing the writing on the wall as crypto firms stand up to them. But time will tell. I am really looking for a legal precedent-setting ruling in these cases. Crypto needs it.