The Senate Banking Committee voted today to approve Gary Gensler’s nomination to be chairman of the Securities and Exchange Commission, moving his nomination to the full Senate.
Banking Committee members voted 14 to 10 along party lines to approve Biden’ nominee to be the nation’s top security cop for a term that would run through June 2026. Gensler served as chair of the Commodity Futures Trading Commission from 2009 to 2014.
Committee Chairman Sherrod Brown (D-Ohio) said he was “confident Mr. Gensler would protect the needs of the people whose hard-earned savings are invested in the market. The Senate confirmed nominee Gensler in the past overwhelmingly. ... I’m confident that Mr. Gensler will carry out the SEC’s mission.”
When pressed by senators regarding how he wants to regulate no-cost trading, as well as Bitcoin and other digital assets, Gensler said he would remain “technology neutral” while preserving capital formation and investor protection.
“With Bitcoin, if it’s a commodity, it’s either for the Commodities Futures Trading Commission to regulate or Congress to determine. ... I think technology and markets constantly change and evolve and that it’s important for the SEC to provide guidance and clarity,” said Gensler, who noted that custody of funds with regard to digital assets is one area needing greater guidance.
Gensler also said he believes investors should not be bound by mandatory arbitration clauses and able to take broker-dealers and investment professionals to court to settle disputes.
Gensler brought $1.7 billion in enforcement actions against Wall Street after the 2008-2009 market meltdown when he was as head of the Commodity Futures Trading Commission.
Sen. Elizabeth Warren (D-Mass.) asked Gensler if he thought it was fair that investors who believe they’re defrauded be bound solely by broker-dealers’ mandatory arbitration clauses when seeking to obtain relief.
“If someone’s been cheated by a broker-dealer, hypothetically for example. [Or] if Robinhood cheated individual investors, hypothetically, should that company be able to use forced arbitration clauses to avoid getting sued and held accountable?” Warren asked.
“While arbitration has its place, I think it’s so important investors, or in that case customers, have an avenue to redress their claims in the courts,” Gensler replied.
Ranking member Patrick Toomey (R-Pa.), among those voting against the nomination, said, “Nothing Mr. Gensler said at his hearing has alleviated my concerns about him."