SEC to close regional office after judge dismisses debt fund lawsuit

The United States Securities and Exchange Commission (SEC) will close one of its eleven regional offices after a federal judge ordered the regulator to pay nearly $1.8 million in attorneys' fees and receivership fees.

In a June 4 announcement, the SEC said it will close its Salt Lake regional office in 2024—one of eleven regional offices in the country. The commission said the closure was due to “significant attrition” at the office and plans to move operations to Denver.

The announcement comes about a week after Judge Robert Shelby dismissed the SEC's civil suit against Digital Licensing, the firm operating as a DEBT box. He also signed an order requiring the SEC to pay about $1 million in attorney fees and costs and $750,000 in receivership fees and costs.

The SEC filed charges against DBT Box in July 2023, alleging that the firm ran an illegal $50 million crypto scheme. However, in March, Judge Shelby issued a temporary restraining order to freeze DEBT Box's assets, finding that the SEC had “engaged in bad faith conduct.” The judge ordered sanctions against the SEC, requiring the regulator to cover “all attorneys' fees and costs arising out of the earlier relief it properly entered.”

Related: US Senators Call SEC Actions on DEBT Box Case ‘Unthinkable'

Two SEC attorneys – based in the Salt Lake regional office – who handled the case have reportedly resigned. It is not clear whether their rise contributed to the “significant benefit” the commission cited.

“[T]He decided to close the SEC [the Salt Lake City] A direct response to the ‘gross abuse of power' by dismissing the DebtBox case should be brought before Judge Shelby to ensure that there is no malpractice or abuse of power if it is re-examined by the SEC,” Chief Marketing Officer Miguel Francis-Santiago told Cointelegraph.

The commission has ongoing enforcement actions against several crypto companies, including Coinbase, Binance, Kraken and Ripple. In May, lawyers for Terraform Labs and co-founder Do Kwon announced they had reached a settlement in principle in the case with the SEC.

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Update (June 4 at 9:25 pm UTC): This article has been updated to include a statement from the debt box.