SEC Unveils New Unit to Tackle Crypto and AI Fraud

The U.S. Securities and Exchange Commission (SEC) has launched the Cyber and Emerging Technologies Unit (CETU), a new division focused on combating fraud in cryptocurrency, artificial intelligence, and other digital technologies.

CETU replaces the Crypto Assets and Cyber Unit, becoming the agency’s primary digital asset anti-fraud team. The unit will be led by Laura D’Allaird and will operate with a team of 30 fraud specialists and SEC attorneys, per a Feb. 20 press release.

D’Allaird will work closely with the SEC’s Crypto Task Force, headed by Commissioner Hester Peirce. Previously, she co-chaired the Crypto Assets and Cyber Unit alongside Mark Sylvester, though it remains unclear whether Sylvester will have a role in CETU.

SEC’s Structural Shift Under Trump’s Return

The reorganization reflects ongoing changes at the SEC, particularly since Donald Trump’s return to office. Under his administration, the SEC has taken a more crypto-friendly stance, marked by:

• The resignation of former SEC Chair Gary Gensler, a well-known crypto skeptic.
• Pro-crypto Commissioner Mark Uyeda assuming Gensler’s duties.
• The creation of the Crypto Task Force, which has engaged digital asset firms like Jito Labs over Ethereum staking.
• The reassignment of Jorge Tenreiro, the SEC’s top crypto prosecutor.

SEC Reverses Crypto Crackdowns

The SEC has also halted enforcement actions against major crypto exchanges like Binance and Coinbase. Under Gensler’s administration, the SEC sued both firms in 2023, alleging unregistered securities offerings and federal violations.

Now, under Trump’s administration, the SEC is shifting its focus toward scaling back enforcement actions and providing clearer regulatory guidelines for the digital asset industry.

With CETU now in place, the agency aims to balance investor protection while fostering a more open regulatory approach to crypto and AI innovation.