Is the SEC the best system?

January 31, 2023
min read
Is the SEC the best system?

So began Jon Stewart’s interview with Gary Gensler, held in March 2022 for his podcast 'The Problem with Jon Stewart'. In it, the veteran journalist and media personality grilled the SEC Chairman about his organization’s shortcomings, specifically in their investigation of the short squeeze scandal that occurred in early 2021.

In light of that episode, Stewart’s question was indisputably a valid one, considering that it was retail investors who exposed the scandal, while the SEC remained unaware of the events, or turned a blind eye – either way, the blame was ultimately and wrongfully placed on retail investors rather than hedge fund owners. Still, Gensler’s response suggested that he has faith in the system nevertheless, though he acknowledges that it’s flawed to an extent and does not sufficiently protect the American people. The SEC can make proposals about new rules it wishes to implement, but Congress is ultimately burdened with writing laws, not the SEC, Gensler explained, when Stewart asked if the SEC was doing enough to create equal opportunity for all investors.

Later on in the conversation, Stewart emphasized important aspects of financial corruption cases, including the important fact that, unlike other types of crimes, the majority of those charged with financial infractions end up paying fines rather than going to jail. Moreover, Stewart points out that more than half of the fines levied are not ever actually collected, and that the pace of judgments in general have slowed over the last 15 years.

Watch the full interview, and decide for yourself how confident you are that Gary Gensler is doing enough to fix the stock market. 

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CEOBLOC is an activist bloc of public CEOs, executives, and shareholders committed to putting an end to naked short selling and other abusive trading practices.

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