According to Foresight News, Jake Chervinsky, a cryptocurrency lawyer and Chief Legal Officer of Variant Fund, has criticized the U.S. Securities and Exchange Commission (SEC) for allegedly using the Wells process as an intimidation strategy. Chervinsky expressed his shock at the number of Wells notices related to cryptocurrencies that the SEC has issued in recent months. He finds it hard to believe that the SEC could or would undertake as many enforcement actions as the number of notices issued.
Chervinsky further stated that if the SEC were to take as many enforcement actions as the number of Wells notices issued, it would be openly violating the law and its Congressional authorization. If not, then it is apparently misusing the Wells process to intimidate upright American companies for free. The Wells process is a procedure by which the SEC notifies individuals or firms that it is considering taking enforcement action against them. This allows the recipients of the notice to respond before any action is taken. Chervinsky's comments highlight growing concerns about the SEC's approach to regulating the cryptocurrency industry.
