At Hearing, Expert Witnesses Agree With Warren That Trump Selling Early Access to Truth Social Posts Not Good for Our Markets
“Raise your hand if you believe that President Trump selling information about the economy and foreign policy to Wall Street before everyone else gets access to that information is good for the integrity of our capital markets? …. I see no hands”
Watch hearing here | Watch hand-raising exchange here
Washington, D.C. – Today, U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, delivered opening remarks and questioned witnesses at a committee hearing entitled "Empowering Main Street by Unlocking Access to Capital." Witnesses included Cantrell Dumas, a senior researcher for Financial Regulation and Policy at the Joint Center for Political and Economic Studies; Dalia Blass, the Senior Investment Management Partner at Sullivan & Cromwell; Kenneth Bentsen, Jr., the President and CEO of Securities Industry and Financial Markets Association; and Michael Flood, senior vice president at the U.S. Chamber of Commerce Center for Capital Markets Competitiveness.
Transcript of Ranking Member Warren’s opening statement below:
Thank you, Mr. Chairman. And thank you for holding this hearing. I believe in markets. Fair and transparent markets promote innovation, they power economic growth, they give everyone a chance to thrive. The confidence that investors at home, and around the world, place in the integrity of our markets is a critical part of why our nation’s economy is the envy of the world.
But under President Trump, the corruption is so massive and so unprecedented that it has fundamentally changed our markets, rigging them for the wealthy and the well-connected. Those with money and power get special treatment, while families, small businesses, and communities pay the price.
We should be working together to make our markets stronger and to ensure that they serve American businesses and American families. I know we share that goal. Our number one job—number one—should be to put a stop to this corruption and to protect investors.
Understand, the corruption is everywhere. It’s been about 15 months since Paul Atkins was sworn in to lead the Trump SEC. At every turn, he has let scammers off the hook and rolled back the rules that protect investors from getting cheated. Corruption. Corruption. Corruption.
Under Trump and Chair Atkins, there is no cop on the beat to protect investors. The SEC’s enforcement activity dropped by 20% last year. Chair Atkins couldn’t even say under oath in this room that insider trading is bad. Fraudsters and cheats? It appears that everyone gets a free pass.
Chair Atkins is also making markets more secretive. He’s slashing disclosure rules so that companies can hide just how risky they’ve become. He’s gutting oversight and enforcement tools that help the financial cops on the beat go after insider trading, after market manipulation and other corporate crimes. He’s making it easier for executives to silence shareholders and to strip them of their rights. He is even making it harder for states to protect their own citizens from being defrauded. Across the board, every day, investors are losing.
Chair Atkins rigs the rules—just one more example of the corruption that hangs over the entire Trump Administration.
This corruption costs American families and retirees, but who wins? Well, corruption is really profitable for some people.
Companies and executives whose business models are built on fraud win, while honest businesses competing on this unfair playing field lose.
Trump’s billionaire buddies win. Donating big time to Trump could mean the SEC case against you just suddenly disappears.
Another Trump friend who won big? Elon Musk, who briefly became the world’s first trillionaire, got his SpaceX IPO greenlit despite analysts calling the numbers “nonsensical.” SpaceX got an additional boost when Elon Musk reportedly pushed some index providers to bend their rules so tens of millions of Americans are forced to have SpaceX in their retirement funds even if it injects significant risk.
And then President Trump himself is the ultimate winner. He made $1.4 billion off his major crypto ventures just last year, while nearly a million investors lost out on nearly $4 billion on Trump memecoins alone. And now, his social media company has come up with a plan to sell Wall Street firms access to his market-moving posts on Truth Social before everyone else gets to see them. And who benefits? Well, only people who can pay more than a million dollars a year for the inside scoop on what Trump will be doing. This is a brazen scheme to profit off the Presidency and it may be—and should be—flatly illegal.
How can Americans – or the world, for that matter – trust the honesty of our markets as Trump and the SEC burn our credibility?
Study after study shows that corruption significantly reduces growth and investment, even in America. There is a cost to this corruption, and we all have a responsibility to rein it in.
I have not given up on the original promise of our capital markets. We need to act before our standing in the world craters, and our people pay for this for generations to come.
Thank you, Mr. Chairman.
Transcript of Ranking Member Warren’s exchanges with the witnesses:
Ranking Member Warren: Thank you, Mr. Chairman. So, this is a hearing about making capital markets stronger, so let’s start with recent market news. On Saturday, President Trump’s social media company began offering faster access to his social media posts to investors who pay up to $100,000 a month—that’s over a million dollars a year per investor.
So, let me ask all of our witnesses here. Raise your hand if you believe that President Trump selling information about the economy and foreign policy to Wall Street before everyone else gets access to that information is good for the integrity of our capital markets?
All Witness: (fail to raise hands)
Ranking Member Warren: There we go. I see no hands, so maybe if the Republicans on this Committee wanted to strengthen capital markets, we can start by outlawing what President Trump is doing. We all know that this is wrong.
Let’s look at another scam. Trump’s private equity buddies have a problem—big investors are starting to head for the exits. Trump’s crypto buddies also have a problem— with billions in losses for investors. So last August, President Trump threw them a lifeline: he directed federal agencies to make it easier for private equity, private credit, crypto, and other risky assets to be shoveled into retirement accounts. The idea is to give all of those sketchy dealers access to families’ 401(k)s.
Now, Mr. Dumas, you’re an expert on financial regulation and its impact on working families and Black communities. Is pushing these risky assets like crypto and private equity into retirement accounts likely to help families?
Dumas: That’s a very good question, Senator. Not likely. Pushing private equity into retirement accounts creates a certain risk. Private equity has less– is risky because it’s less transparent, non-disclosure, and doesn’t have customer protection. Digital assets also have evolved as an asset as well. There isn’t evidence out there, currently, that says that cryptocurrency provides any type of wealth-building growth for, especially, for families, for ordinary families. So I think that obviously, it can, can definitely provide less wealth opportunity for families.
Ranking Member Warren: Alright, thank you. Let’s look at other Trump Administration policies. When you invest in a public company, you know, like Pepsi or Apple, those companies are required to file basic financial and business information with the SEC four times a year. In May, the SEC proposed reducing those disclosures to two times a year.
Days later, the SEC proposed rules that exempt 80% of public companies from disclosures and accountability on what executives get paid.
The SEC even exempted most companies from the requirement that their auditor must swear that the company has systems in place to produce accurate financial information.
So Mr. Dumas, is getting less information less often about a company’s operations helpful for working people, for mom and pop investors, or for Black communities?
Dumas: No, Senator. It’s not helpful at all. Disclosure and transparency is vital for confidence in investment. Less information leaves ordinary investors in the dark. What we need is better information in order for investors to have the same amount of information as sophisticated investors have. Without that, there would be an information gap between sophisticated investors and ordinary investors.
Ranking Member Warren: Thank you, Mr. Dumas. Let me do one more. In addition to weakening the rules, Trump’s SEC is taking the cop off the beat. Last year, enforcement activity dropped by over 20%, to its lowest level in nearly 20 years.
Mr. Dumas, who benefits when the SEC fails to enforce the law?
Dumas: Senator, I believe bad actors would benefit. Actually, I believe that without strong enforcement you have more of an opportunity for scammers and fraudsters to take advantage of everyday Americans. Strong enforcement provides confidence in the marketplace so that people can put more into the capital markets as well.
Ranking Member Warren: Every one of these steps is designed to help Wall Street, big corporations, and President Trump himself – not American families. Congress needs to clean this up.
Thank you, Mr. Chairman. I yield back.
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