Wagner Law Group, an ERISA law firm, has previously cautioned retirement plan fiduciaries on the risks of using crypto investments in their plans, in large part because of the industry’s frequent compliance issues.
On November 20, the SEC charged Kraken, a crypto exchange, for operating as unregistered securities exchange. This prompted Wagner Law Group partner Kimberly Shaw Elliott to caution fiduciaries of the risks of crypto assets given their compliance issues:
“The SEC’s new enforcement activity should be a clear warning to not only unregistered crypto providers and the advisers who recommend crypto investments, but also to retirement plan fiduciaries who approve those investments,” she wrote. “Is it prudent to place faith in the seller or holder of crypto who does not go through the rigors of registration?”
The Treasury Department issued a record-breaking multi-billion dollar fine against Binance the next day, further compounding the fiduciary risks of crypto assets.
The Treasury Department fine totals approximately $4.3 billion against Binance, a crypto exchange, among other penalties. The Securities and Exchange Commission in June had charged Binance with operating as an unregistered securities exchange and those allegations have not yet been resolved.
On the Binance record-breaking fine, Marcia Wagner, the founder and managing partner of Wagner Law Group, says “I do not believe that the amount of the fine per se will have an effect upon a plan fiduciary’s...
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