U.S. SEC claims tech failures led to loss of relevant Gensler texts

The U.S. Securities and Exchange Commission (SEC) said Wednesday it lost nearly a year’s worth of text data from its former Chair, Gary Gensler. The agency’s Office of the Inspector General implicated tech failures for the loss of messages.

The report revealed that Gensler’s SEC-issued smartphone was functioning normally and was used regularly until July 6, 2023, when it encountered some tech problems. The OIG also highlighted that Gensler’s smartphone had stopped syncing with the agency’s device management systems.

OIG introduces policy that wipes devices not connected for 45 days

The report revealed the agency’s Office of Information Technology (OIT) staff failed to notice that the phone was showing an inactive status in the 62 days that followed. The OIG later introduced a policy on August 10 that automatically wipes any device that has not connected for 45 days. 

The agency’s independent watchdog launched the initiative, arguing that devices might be lost or stolen. The rule also led to Gensler’s phone being wiped. 

The former SEC Chair arrived at the agency’s headquarters on September 6, 2023, and found his device lacked the SEC’s apps. Gensler inquired for help from the agency’s IT staff, who investigators said were unaware of what had transpired. The office permanently deleted text messages from October 18, 2022, through September 6, 2023, while performing a factory reset in a bid to restore the device.

The Office of the Inspector General said missed warnings and poor vendor coordination mainly compounded the failure. The agency also blames the AAR, whose purpose was to review why Gensler’s device stopped communicating with the SEC’s mobile device management systems.

Weak change-management practices in the agency, which caused the enterprise wipe, were also flagged as a catalyst for the failure. The agency also argued that a lack of backups and procedures that failed to consider record retention requirements for SEC officials heightened the situation and hindered the watchdog’s response.

SEC plans steps to back up its officials’ records and data

According to the report, the SEC disabled text messaging features in its entire staff’s devices agencywide after the National Archives and Records Administration notified the agency in June 2025 of the lost records. The agency also said it plans to take necessary steps to back up its officials’ records and data, among other actions. 

The agency revealed that the loss of Gensler’s text messages may impact its response to certain Freedom of Information Act requests. The SEC also recommended specific actions, including updating or developing plans, policies, and procedures related to troubleshooting activities on its officials’ devices and the system used for device management. 

The agency aims to complete the action by November 2025, with the OIG evaluating that the proposed actions are responsive. The OIG hopes the recommendation is resolved and will be closed upon verification of the action taken.

The OIT reviewed about 1,500 messages recovered from Gensler’s records and determined that the majority were federal records. According to the agency’s review, nearly 38% of the recovered text messages were determined as mission-related and concerned matters directly involving the SEC’s staff.

Get seen where it counts. Advertise in Cryptopolitan Research and reach crypto’s sharpest investors and builders.