U.S. Congress members recently initiated a joint investigation into the U.S. Securities and Exchange Commission (SEC), suspecting that the SEC may have violated federal law and compromised the integrity of the agency by screening senior hires based on political affiliations.
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Political Correctness in Hiring?
Employee Assurance: Shared Political Views
Political Issues Affecting Regulatory Agenda
Political Correctness in Hiring?
According to a letter sent to SEC Chairman Gary Gensler on September 11, the investigation was launched by three Republican members, including:
Judiciary Committee Chairman Jim Jordan
Oversight and Accountability Committee Chairman James Comer
Financial Services Committee Chairman Patrick McHenry
The investigation will focus on whether the SEC considered political affiliations in hiring senior staff.
Employee Assurance: Shared Political Views
The letter cites Dr. Haoxiang Zhu, who was appointed as the Director of the Division of Trading and Markets in November 2021. Zhu reportedly assured the SEC chairman via email that his political views aligned with Gensler’s:
“After our discussions, I believe I am in the right position politically, and I can provide any necessary details to reassure you.”
Six months later, on November 19, 2021, the SEC hired Zhu. Additionally, the letter mentions other organizations suspected of deliberately hiring leftist individuals, including the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), the Consumer Federation of America (CFA), and the Washington Center for Equitable Growth. Some personnel changes are perceived as intentional placements of specific political ideologies in senior positions.
Political Issues Affecting Regulatory Agenda
The letter emphasizes that the alleged misconduct is not an isolated incident but reflects a broader issue of political bias in the hiring of SEC senior personnel, questioning whether the SEC, under Gensler’s leadership, has allowed political views to influence its regulatory agenda.
Judiciary Committee Chairman Jim Jordan stated:
“This investigation is crucial to ensure that the SEC is an unbiased regulatory agency free from political influence. If political bias affects hiring decisions, it will undermine public trust in the SEC’s fair enforcement of securities laws.”
The SEC has been requested to submit all documents and communications related to the hiring, firing, or reassignment of senior staff since April 2021 for detailed review. Should the SEC fail to comply, Congress may take further action, including issuing subpoenas.
The SEC has not yet responded to the letter or the allegations related to political hiring. However, as the congressional investigation progresses, the SEC is expected to face increasing pressure.
Dr. Haoxiang Zhu
Gary Gensler
Patrick McHenry
SEC
Political Correctness
Further Reading
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