Gurbir Grewal quits as SEC Enforcement Director

The US Securities and Exchange Commission’s Indian American enforcement director, Gurbir S. Grewal is leaving the agency after a three-year tenure marked by stepped up enforcement against Wall Street and cryptocurrency firms.

On Grewal’s departure on October 11, another Indian American, Sanjay Wadhwa, a 21-year agency veteran, will take over as Acting Director, SEC announced Oct 2.

Leading SEC’s 1,500-person enforcement unit since July 2021, after serving as New Jersey attorney general, Grewal pursued big cases in the crypto sector, including suing exchanges Binance and Coinbase for facilitating illict offerings to retail investors. It also charged FTX as part of a larger government action against the exchange’s multibillion-dollar fraud and sued the firm’s auditor for negligence.

Under his leadership, SEC embarked on a sprawling, multi-year investigative initiative focused on Wall Street’s use of personal devices and apps such as WhatsApp to discuss business, levying over $2 billion in civil fines against dozens of firms including JP Morgan Chase, Goldman Sachs and Morgan Stanley.

READ: SEC appoints Indian American Gurbir Grewal as Director of Enforcement (July 1, 2021)

Under Grewal, SEC enforcement has also fought Elon Musk in court over the billionaire’ s failure to show up to testify for the agency’s investigation into his takeover of Twitter, now known as X, and brought settled charges against billionaire investor Carl Icahn for disclosure failures.

During Grewal’s tenure, more than 2,400 enforcement matters resulted in orders for more than $20 billion in disgorgement, prejudgment interest, and civil penalties, more than 340 industry bars against individuals, more than $1 billion in awards to whistleblowers, and the return of billions of dollars to harmed investors, the regulator stated in a press release.

“We have been incredibly fortunate that such an accomplished public servant, Gurbir Grewal, came to the SEC to lead the Division of Enforcement for the last three years,” Chair Gary Gensler said. “Every day, he has thought about how to best protect investors and help ensure market participants comply with our time-tested securities laws. He has led a Division that has acted without fear or favor, following the facts and the law wherever they may lead. I greatly enjoyed working with him and wish him well.”

“I’m pleased that Sanjay Wadhwa has said yes to taking on the Acting Director role,” Gensler said. “He has served as part of a remarkable leadership team, along with Gurbir, as Deputy Director and has been with the agency for more than two decades. He has shown strong leadership, is widely respected among his colleagues, and has provided invaluable counsel to the Commission.”

“While we have faced and overcome many challenges over the last three plus years, there has been one constant throughout: the public servants of the Enforcement Division stand ready to do everything they can to protect investors and market integrity,” Grewal said. “Their expertise, professionalism, and dedication are, indeed, unparalleled, and it has been the privilege of a lifetime to have been able to call them colleagues.”

“From recalibrating penalties and remedies to confronting emerging risks to holding issuers, insiders, and gatekeepers accountable, I am incredibly proud of all that we’ve accomplished as a Division during my tenure. I am grateful to Chair Gensler not just for the opportunity to lead the Division, but also for his unwavering commitment to investor protection and support of a robust enforcement program.”

As Enforcement Director, Grewal prioritized restoring investor trust and confidence in the financial markets by emphasizing proactive enforcement initiatives and working to create a culture of compliance among market participants, the regulator stated.

Under Grewal’s leadership, the Division also prioritized holding insiders, industry professionals, and gatekeepers accountable for their securities law violations, rooting out fraudulent conduct, enforcing disclosure and recordkeeping requirements, and enforcing whistleblower protections, it stated.

Immediately before joining the SEC, Grewal was the Attorney General for the State of New Jersey from Jan 2018 through June 2021. Prior to that, he served as the Bergen County Prosecutor, the chief law enforcement officer for New Jersey’s most populous county.

Earlier in his career, Grewal served as an Assistant United States Attorney for the District of New Jersey, where he was Chief of the Economic Crimes Unit, and an Assistant United States Attorney for the Eastern District of New York, where he was assigned to the Business and Securities Fraud Unit.

He was also an attorney in private practice. Grewal holds a JD from the College of William & Mary, Marshall-Wythe School of Law, and a BS in Foreign Service from the Georgetown University School of Foreign Service.

Wadhwa has served as Deputy Director of the Enforcement Division since Aug 2021 working closely alongside Grewal to execute the SEC’s Enforcement agenda and to further the agency’s mission to protect investors.

Before becoming Deputy Director, Wadhwa was the Senior Associate Director of the Division of Enforcement in the New York Regional Office (NYRO), Deputy Chief of the Market Abuse Unit, and Assistant Director in NYRO.

Prior to joining the SEC as a staff attorney in Enforcement in 2003, Wadhwa served as a tax associate at Cahill Gordon & Reindel LLP and Skadden, Arps, Slate, Meagher & Flom LLP. Wadhwa has a BBA from Florida Atlantic University, a J.D. from South Texas College of Law Houston, and an LL.M. in taxation from New York University School of Law.

(This story was originally published by The American Bazaar.)