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The U.S. Securities and Exchange Commission (SEC) has announced that the loss of Gary Gensler’s text messages has exposed vulnerabilities in the agency’s records management, potentially undermining public accountability. This announcement was made in a special review report.
According to The Hill, the SEC has faced increasing criticism for opacity in its decision-making processes, particularly during Gensler’s leadership. During this period, crypto firms and lawmakers accused the agency of "regulation by enforcement." Critics argue that transparency lapses weaken trust in both oversight and fairness, especially when enforcement actions have global market impacts. The loss of official records during this time compounds concerns that the SEC was failing to meet its transparency obligations.
The SEC Office of Inspector General's Report No. 587 revealed that nearly a year’s worth of Gensler’s text messages were erased due to a mistaken "enterprise wipe" followed by a factory reset. These messages, spanning October 2022 through September 2023, included both administrative and mission-related communications with senior SEC officials and international counterparts. The OIG confirmed that many of the recovered texts qualified as federal records, underscoring that unrecovered ones almost certainly did as well.
