The U.S. Government Accountability Office (GAO) has announced plans to investigate recent changes at the Securities and Exchange Commission (SEC), including those influenced by the White House and Elon Musk’s Department of Government Efficiency.
This decision follows requests from Democratic Senators Elizabeth Warren and Mark Warner, who expressed concerns about the SEC’s ability to fulfill its mission amid significant restructuring.
In a letter dated April 8, GAO confirmed it will review the SEC’s recent efforts to reduce staff, terminate office leases, and consolidate operations.
The investigation is expected to begin in about three months and will focus on how these changes affect the agency’s regulatory functions over U.S. capital markets.
Since President Donald Trump took office and Republicans gained control of the SEC, the agency has undergone sweeping transformations.
These include dropping high-profile enforcement cases, reorganizing personnel, and limiting the enforcement division’s power to initiate formal investigations. Additionally, the SEC is experiencing a wave of resignations, with hundreds of employees accepting buyout offers as part of a broader federal government downsizing effort led by Trump and Musk.
Senators Warren and Warner emphasized the importance of understanding how these changes impact the SEC’s ability to protect investors and maintain fair markets. They highlighted that while Congress sets the SEC’s budget, the agency is funded through fees on financial transactions rather than taxpayer dollars.
The SEC’s restructuring comes amid heightened market volatility following President Trump’s announcement of sweeping tariffs on April 2, which were later paused.
The agency’s ongoing staff reductions and office consolidations raise concerns about its capacity to oversee the financial markets effectively during such turbulent times.
In summary, the GAO’s upcoming probe will examine the scope and impact of the SEC’s recent overhaul, focusing on staffing cuts, lease terminations, and operational changes.
This review aims to ensure that the SEC continues to fulfill its critical role in regulating the nation’s financial markets despite the significant organizational shifts underway.
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