SEC Collected Record $8.2B in Remedies in FY24, 56% Came from Terraform Labs

Monday, 25/11/2024 | 05:59 GMT by Arnab Shome

The agency recovered $6.1 billion while imposing penalties of $2.1 billion.

It filed 583 enforcement actions, a 26 per cent decline year-over-year.

The U.S. Securities and Exchange Commission Reuters

The Securities and Exchange Commission (SEC) collected a record $8.2 billion in recoveries and fines in fiscal year 2024, driven by its action against algorithmic stablecoin issuer Terraform Labs and its CEO, Do Kwon. The total remedies amount jumped by 65.5 percent from the previous fiscal year.

The SEC’s total fines and penalties over the years: Source: SEC — The SEC’s total fines and penalties over the years; Source: SEC

Crypto Was the Top Contributor

The regulator highlighted that 56 per cent of its total remedies came from Terraform Labs and Kwon. The crypto company and its CEO settled with the regulator for securities fraud charges, agreeing to pay $4.5 billion in recovery and civil penalties earlier this year.

The lawsuit against Terraform Labs was one of several high-profile actions brought by the regulator against crypto companies. Another prominent lawsuit against Ripple Labs concluded this year with an order of $125 million against the blockchain company, which has since appealed. Additionally, the regulator had sought $1.95 billion from the San Francisco-based crypto payments firm.

Out of the total amount collected by the SEC, $6.1 billion came from recovery and interest, marking the highest figure in the regulator's enforcement history. The agency also collected $2.1 billion in civil penalties, the second-highest amount on record.

A Decline in Enforcement Actions

Furthermore, the US securities watchdog filed 583 enforcement actions in fiscal 2024, a 26 per cent decline from the previous year. It also received 45,130 tips, complaints, and referrals, another record-breaking figure. The agency distributed $345 million to harmed investors, bringing the total returned amount to over $2.7 billion since 2021.

Meanwhile, the incoming Donald Trump administration is expected to shake up the SEC’s priorities, particularly regarding cryptocurrencies. Gary Gensler, the current SEC Chair, has announced he will step down on 20 January, the day President Trump is inaugurated. While Trump has not yet confirmed a replacement for Gensler, several crypto-friendly candidates have been mentioned in the media as potential appointees for the top regulatory position.

The next SEC Chair will also oversee several critical crypto litigations, including ongoing cases with Coinbase and Binance. Interestingly, Coinbase has also sued the regulator for clarification on crypto rules.