(Article from Registered Funds Regulatory Update, July 2022)
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On May 3, 2022, the SEC announced it was adding 20 positions to the Division of Enforcement’s Crypto Assets and Cyber Unit, formerly called the Cyber Unit, bringing the Unit’s total headcount to 50 dedicated supervisors, investigative staff attorneys, trial counsels, and fraud analysts. Since its creation in 2017, the Unit has brought more than 80 enforcement actions related to fraudulent and unregistered crypto asset offerings and platforms. The Unit has also brought numerous actions against SEC registrants and public companies for failing to maintain adequate cybersecurity controls and appropriately disclose cyber-related risks and incidents.
The announcement highlights the SEC’s focus on cyber-related threats and added scrutiny of securities law issues related to crypto, including asset offerings and exchanges; asset lending and staking products; decentralized finance platforms; non-fungible tokens; and stablecoins.
SEC Division of Enforcement, Press Release, SEC Nearly Doubles Size of Enforcement’s Crypto Assets and Cyber Unit (May 3, 2022), available at: https://www.sec.gov/news/press-release/2022-78.