SEC Collects Record $8.2 Billion in Fines in 2024
Date: 2024-11-25 Author: Henry Casey Categories: BUSINESS
The U.S. Securities and Exchange Commission (SEC) has recorded record-breaking penalties in 2024, collecting $8.2 billion in fines and other sanctions. At the same time, the number of cases initiated by the agency has decreased by 26% compared to last year, amounting to 583 cases.
The largest share of the penalties this year was the case against Terraform Labs, related to the collapse of the Terra/Luna ecosystem in 2022. The $4.5 billion fine imposed on the company and its CEO Do Kwon accounted for 56% of the total penalties for the year. The SEC described the case as one of the largest securities fraud cases in its history, highlighting its impact on the crypto market, which suffered significant losses.
In addition to Terraform Labs, sanctions were imposed on Silvergate Capital, a bank closely associated with cryptocurrencies. The BarnBridge DAO project also came under fire for unregistered crypto assets classified as securities.
One of the SEC's priorities remains the protection of financial market participants who suffered. This year, the commission allocated $345 million in compensation, increasing the total amount of payments from 2021 to $2.7 billion. The agency also actively cooperated with whistleblowers, receiving more than 24,000 reports and distributing rewards worth $255 million.
SEC Chairman Gary Gensler emphasized that these efforts confirm the agency's commitment to the mission of ensuring fairness and order in the markets. According to him, the enforcement division strictly follows the law to hold those who break the rules accountable.
However, not everyone agrees with the agency's methods. Some experts have expressed doubts about whether large fines are effective in solving financial markets’ problems. Miles Jennings of a16z crypto said that while fines are a visible indicator of the SEC’s activity, they do not necessarily mean success in preventing violations.
So while the SEC’s actions are aimed at increasing investor confidence, their effectiveness in solving underlying problems remains a matter of debate.
