He donated to Hillary Clinton’s presidential campaign in 2016, but two years later he was on the Trump administration, giving one of the most consequential — and controversial — speeches on crypto policy. Subsequently, while working in Trump’s SEC, he was donating to Democratic candidates, including thousands of dollars to Joe Biden’s presidential campaign.
Now, former SEC Director of Corporation Finance William Hinman is in Washington, soliciting clients in the crypto business, and that’s not sitting well with some.
Hinman is the target of an ad campaign by a consumer advocacy organization telling lawmakers, including the Trump administration, of Hinman’s donations to Trump’s adversaries and over “the role he played in bringing about a crypto winter in the United States that lasted for years.”
Hinman listed the SEC and his law firm, Simpson Thacher, contemporaneously, as his “employer” on FEC reports. Also, it appears millions of dollars in payments moved from Simpson Thacher to Hinman while he was at the SEC, which is reportedly the subject of an inspector general investigation.
The SEC inspector general’s investigation into Hinman, who served in the agency from 2017 to 2021, has been shrouded in a veil of secrecy. In fact, the SEC never publicly announced the probe, but the Washington watchdog group Empower Oversight announced the investigation was “in the final stages.”
“Transparency and honesty can go a long way helping answer the very legitimate concerns that so many people have regarding the SEC’s actions to hold officials accountable for the conflicts of interest that have caused so much controversy,” said Empower Oversight president Tristan Leavitt.
The inspector general report has never been publicly released. A representative did not respond to a request for comment on the report.
Hinman gained attention in June 2018 when he declared the sale of digital tokens “will not take it out of the purview of the U.S. securities laws.” However, he seemed to give what commentators called a “free pass” to two cryptocurrencies, Bitcoin and Ethereum. He was speaking on crypto at the Yahoo Finance All Market Summit.
That speech, says Gerard Scimeca with Consumer Action for a Strong Economy, is viewed by many as the statement on crypto regulation that “gave birth to the SEC’s regulation by enforcement policy against innovators, which fostered the crypto winter and forced crypto companies and financial investment overseas.”
In addition, says Scimeca, it runs counter to Trump’s mission outlined in his Day Three Executive Order, “Strengthening America’s Leadership in Digital Financial Technology.”
“With Hinman still lingering in DC seeking to influence public policy and financial markets, CASE wants to highlight that President Trump will have difficulty cleaning house and initiating his pro-Crypto agenda at the SEC with adversaries like Hinman working behind the scenes to undermine his efforts,” Scimeca said.
Trump has said he wants to make the United States the crypto capital of the world.
Trump nominated Paul Atkins, an advocate of cryptocurrency, to be the new SEC chair.
