A federal judge issued a rebuke to the Securities and Exchange Commission last week regarding materially false representations made while seeking to freeze $49 million related to DEBT Box.

Read more: Senator Elizabeth Warren Calls Crypto A Threat

Key Details:

• In November 2023, Judge Shelby ruled the SEC made misleading claims about crypto lending platform DEBT Box when covertly requesting asset seizures.
• Judge ordered the SEC to “show cause” why its conduct merits punishment given appearance of lacking candor.
• The agency responded by asking for an extension to allow a new team of lawyers to review events prompting the court’s concerns.
• SEC stated it “takes very seriously” doubts raised regarding the truthfulness of submissions.
• Judge grants an extension for the SEC to respond.

Judge Grants SEC additional time

The SEC stated in a statement on December 7 that it needed more time to prepare its response to the court’s order to show cause. The Commission gave the court the assurance that it has started a comprehensive process and takes the issues seriously.

“The Commission takes very seriously the concerns expressed by the Court in the Order to Show Cause and has undertaken a process to provide the Court with a thorough response to the Court’s questions,” the SEC lawyers wrote.

This involves hiring a fresh group of lawyers from the Office of the General Counsel (OGC) of the Commission to examine the circumstances that gave rise to the court’s worries and draft a suitable...

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