You’ll hear Gary Gensler’s name come up often in Washington financial circles. The chair of the Securities and Exchange Commission is in the midst of a high-profile turn leading the agency.
He’s angered Wall Street with his tough approach and feuded with Republicans who say he’s overreached. He’s even irked his Democratic allies at times.
So be it. Gensler hopes he won’t be going anywhere for a long time.
“If I’m so honored, I’d continue in this role,” Gensler told us in an interview, when we asked if he’d want to stay in a new Democratic administration. “I love the agency. The issue set is fascinating, and I think it’s continuing to drive efficiency and resilience in these capital markets.”
But his sticking around is no sure thing, no matter who wins the presidential election.
Gensler’s term runs through 2026. Former President Donald Trump has threatened to fire Gensler, and there’s reportedly pressure from some of Vice President Kamala Harris’ donors to do the same.
For now, at least, he remains one of the most significant regulators in Washington. We sat down with Gensler to talk about the agency’s latest projects, his relationship with Congress and what’s next ahead of the 2024 election.
Crypto: Securities law isn’t for everyone — but Gensler says it’s good enough for the crypto sector. Gensler and the SEC’s enforcement arm are the digital asset industry’s single greatest friction point with the federal government.
Gensler recently got a fresh supply of ammo courtesy of the FBI. The bureau published a report earlier this month counting $5.6 billion in fraud “with a nexus to cryptocurrency” in 2023, a 45% increase from 2022.
“It gives you a sense this is a field that’s got a lot of fraudsters, hucksters, grifters, that are trying to prey upon the public’s interest for a better life,” Gensler said, citing the report.
We pushed back on that a bit, pointing out that scammers relying on crypto for payments don’t necessarily implicate the entire industry.
But Gensler noted that, nonetheless, there are plenty of bad actors.
“There’s also straight up preying upon the public, and all too often it’s actually those less able to bear the losses,” Gensler said. “And if you look at the folks that got hurt over the years, there’s significantly — they touch upon communities of color, less wealthy individuals.”
The agenda: Gensler said his focus on the near future is about solidifying work from the recent past. He noted the agency has put in place several major rules, including those focused on corporate governance, money markets, cyber resiliency and changes that allow investors to get money from stock sales faster.
In the coming months, his agency is going to work hard on the “implementation phase” of those policies. It will also try to get some lower-profile proposals over the finish line.
Gensler and Congress: Gensler and the work he’s championed have become political targets of late, particularly for House Republicans. GOP lawmakers love to press the chair on the agency’s agenda and activities, particularly on crypto enforcement actions and climate risk disclosures.
But Gensler brushed off the idea there’s heightened pressure. He said he’s got “warm relationships with people on both sides of the aisle.”
Here’s more from Gensler:
Too big to fail: The effort to end the “too big to fail” era ushered in by the 2008 financial crisis is an ongoing project in Washington. And Gensler told us he was saving a point he wanted to make for when we “weren’t in the midst of a tornado.”
That time came earlier this month when he gave a speech about financial firms in distress and a need for more robust disclosures. His point was that regulators and markets need to have a clear picture of what’s going wrong with a firm.
“Big financial institutions need to use disclosure before they get into a mess,” Gensler said. He argued regulators need to “get disclosures that really speak to the core question: How deep was the hole, and did the hole get filled?”
The Chevron ruling: The Supreme Court’s decision to overturn the Chevron doctrine is undoubtedly a monumental ruling for federal policymaking. It means the courts — not regulators — will get more power in deciding how to interpret any gray area in the law. So we asked Gensler what it could mean for the SEC.
Like with any court ruling, Gensler said his agency will “review it and, if appropriate, we adjust.”
Gensler added he believes Congress “has spoken very clearly over the decades” about the SEC’s role, including a mandate to act as a “competition authority” amid rapidly changing technologies and business models.
“Congress often is pretty specific, and there’s clear direction,” Gensler said.
