Wall Street regulator to restore some jobs after cuts, chair says

• Staff exodus from voluntary buyouts reduced some SEC divisions by nearly 20% as of a year ago, raising concerns about the agency's ability to police markets and respond to crises
• Atkins stated the decision to drop crypto enforcement cases was made by the acting chair before his arrival and primarily involved securities registration failures viewed as 'regulation through enforcement'
• The Trump administration has placed limits on agencies' ability to rehire after staffing cuts, though the SEC avoided mass dismissals by offering voluntary workforce reductions

Summary: SEC to Restore Workforce After Government Cuts

Key Developments:

SEC Chairman Paul Atkins announced plans to restore portions of the agency's workforce following significant staff reductions mandated by the Trump administration's Department of Government Efficiency initiative, led by former adviser Elon Musk. During Senate testimony on February 12, Atkins acknowledged "gaps in different divisions" requiring staffing increases.

Staffing Impact:

The SEC experienced approximately 20% staff depletion in key components as of one year ago, resulting from multiple voluntary buyout rounds. Atkins noted most departures occurred before his arrival and were voluntary, though the administration has since restricted agencies' rehiring abilities. The agency initially used buyouts to avoid mass dismissals implemented at other federal agencies.

Crypto Enforcement Controversy:

Democratic lawmakers accused the SEC of dropping enforcement actions against crypto companies and entrepreneurs with Trump ties as political favors, particularly given Trump's involvement in the crypto industry. Atkins rejected these allegations, stating that his predecessor made case-dismissal decisions before his swearing-in, primarily involving securities registration failures viewed as "regulation through enforcement." He acknowledged presidential pardons and clemency complicate enforcement in certain cases.

Market Implications:

The workforce reductions raised concerns about the SEC's capacity to effectively police financial markets and respond to crises. The restoration of some positions suggests recognition that regulatory oversight may have been compromised, though the extent of rehiring remains unclear given administrative hiring constraints. The crypto enforcement pullback signals a potentially lighter regulatory environment for digital assets under the current administration.