Ripple chief executive officer Brad Garlinghouse came out strongly in criticism of former U.S. Securities and Exchange Commission (SEC) Chairman Jay Clayton’s comments on the agency’s corporate regulatory stance. Starting from the first quarter of 2023, the Commission had been enforcing several anti-crypto actions against crypto exchanges and companies.
Jay Clayton’s Views On US SEC Lawsuits
Clayton’s previous comments from June 2023 gained prominence in the context of the recent development in the lawsuit against Garlinghouse and Ripple founder Chris Larsen. Earlier, CoinGape reported that the US SEC’s charges against the two top executives have been dropped. Interestingly, the charges were levied on December 22, 2023, just before ending his tenure as the SEC Chair. It was much before the actual expiration date in June 2021.
In a June 29, 2023 interview to CNBC, Clayton said the US SEC should ideally be filing lawsuits against individual companies if there is certain legal backing to its argument. He explained that the regulatory agencies should only bring rules and cases that they are confident of passing the judicial framework.
Brad Garlinghouse: “Hypocrisy Is Shocking”
In the context of the SEC voting to dismiss the allegations without prejudice, the Ripple CEO recalled that the former SEC Chair himself was responsible for filing a lawsuit that did not stand a chance before the Court. In the December 2020 XRP lawsuit, the Comission had named Gralinghouse and Larsen alleging that they raised over $1.3 billion through an “unregistered, ongoing digital asset securities offering.” Garlinghouse said,
“As a reminder, Jay Clayton brought the case against Ripple, me and Chris Larsen. And left the building the next day.”
The recent relief for the two executives comes after the July 2023 ruling by Judge Analisa Torres that the sale of XRP on secondary market places to retail buyers does not constitute an investment contract.
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