After a prolonged legal battle, Empower Oversight finally received a report from the SEC’s Office of Inspector General regarding former SEC official William Hinman and his involvement with Ethereum. The report investigated whether Hinman had a conflict of interest when he declared that Ethereum was not a security. You can read the full report here.
It was discovered that Hinman was still receiving payments from his former law firm, which had ties to Ethereum.
William Hinman and Ethereum
In May 2022, Empower Oversight requested the OIG to look into Hinman’s financial relationship with his former law firm, Simpson Thacher, which represented Ethereum. In a speech in 2018, Hinman had publicly stated that Ethereum was not a security.
The investigation concluded that although Hinman had disclosed his financial ties, including the payments from Simpson Thacher, he did not personally benefit from his statements regarding Ethereum.
Despite these findings, Empower Oversight expressed dissatisfaction with the limited scope of the investigation, arguing that it failed to address broader concerns about conflicts of interest within the SEC and its approach to regulating crypto companies.
“By narrowly focusing on whether criminal charges should be brought against Hinman, the SEC OIG completely missed the bigger issue here—an erosion of public trust in the agency due to inadequate transparency and an undeniable lack of faith in the integrity of its cryptocurrency enforcement decisions,” Foster commented.
The OIG’s report, released on December 9, 2024, specifically addressed the question of Hinman violating conflict-of-interest laws, to which the answer was no. Empower Oversight, while appreciative of some progress, continues to push for greater transparency and accountability within the SEC.