John Deaton Highlights SEC’s ‘Bullying Tactics’ With Elon Musk and Crypto Cases
John E. Deaton slam Take Elon Musk’s recent legal run-ins, for example, denouncing the SEC’s aggressive actions against companies and individuals. Deaton highlighted a report that SEC Chairman Gary Gensler had made a settlement demand to Musk and threatened to face charges unless he complied within 48 hours. Musk’s attorney, Alex Spiro, accused the SEC of harassment and politically motivated conduct.
Elon Musk has had a long-standing feud with the SEC, which began in 2018 when the agency accused him of fraud in X posts about the “security of funds” related to taking Tesla private. Musk settled the case, paid a $20 million fine for himself and Tesla, and resigned as Tesla chairman.
However, the settlement only exacerbated his dissatisfaction with the SEC. Musk has repeatedly criticized SEC Chairman Gary Gensler, and he has continued his public attacks since Trump’s election. Musk currently leads the Department for Government Effectiveness (DOGE), an NGO that studies federal spending and regulation.
John Deaton slams SEC actions
That said, Deaton believes that if the SEC treats the world’s richest man this way, small businesses and entrepreneurs will face tougher challenges. He pointed to the LBRY case, in which the SEC allegedly threatened to bankrupt the company and its founder, Jeremy Kauffman, even before the lawsuit was filed.
Likewise, Ripple and its CEO Brad Garlinghouse reportedly spent more than $150 million fighting what Deaton described as “non-fraud” cases. Most companies lack such resources, making it nearly impossible to fight back against the SEC.
Deaton also pointed to the SEC’s action against Longchain as another example of regulatory overreach. He expressed hope that former SEC Commissioner Paul Atkins could reform the agency if given the chance.
X User Core Herbal Medicine responded John Deaton shares another example of SEC overreach during the SEC v. Richard Heart hearing, which the judge struggled to understand Fraud charges from the U.S. Securities and Exchange Commission (SEC). The post suggests that just because the SEC accuses someone of fraud, it doesn’t mean there was any actual fraud. The post said the SEC was using the word “fraud” to unfairly sway public opinion, even though the claims were baseless.
The criticism adds to growing concerns about the SEC’s approach to enforcement, particularly in the cryptocurrency space, where companies often face costly and protracted legal battles.
