After a long legal fight, Empower Oversight received a report from the SEC’s Office of Inspector General. The report investigated whether former SEC official William Hinman had a conflict of interest when he said Ethereum was not a security. 

At the time, Hinman was still getting payments from his former law firm, which was linked to Ethereum.

William Hinman in Ethereum-related decisions

In May 2022, Empower Oversight asked the OIG to investigate Hinman’s financial relationship with his former law firm, Simpson Thacher, which represented Ethereum, a major cryptocurrency participant. In a speech in 2018, Hinman had stated that Ethereum was not a security.

The answer was no. The key point was that he was still being paid by Simpson Thacher at the time. The report also noted that properly disclosed his monetary relationships, and did not personally enrich himself.

However, Empower Oversight was not satisfied. They argued that the probe was too limited, as it sidestepped broader questions about how the SEC handles conflicts of interest in general and how it decides which crypto companies to target. 

“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 said.

The OIG’s December 9, 2024, report answered one very narrow question: had Hinman violated any criminal conflict-of-interest law? 

The response was no. He reported they had to struggle to publish fundamentals. Despite cooperating with the SEC in recovering some of their legal expenses, Empower Oversight continues to demand more openness and accountability.

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