Shamoil T. Shipchandler, a former regional director at the U.S. Securities and Exchange Commission (SEC) who oversaw several high-profile crypto cases, has left the agency for the global law firm Jones Day.
Shipchandler led a team of around 140 enforcement attorneys, accountants, investigators and compliance examiners in the SEC’s Fort Worth, Texas office, the regulator said in announcing his departure. Among other cases, his office brought enforcement actions against would-be token issuer AriseBank and bitcoin futures firm 1Broker.
At Jones Day, Shipchandler will be a partner in the investigations and white collar defense practice at the firm’s Dallas office starting at the end of February. In the blockchain space, the law firm notably supported the inception of security token trading platform tZERO and has been known for providing expertise on the legal implications of ICOs and smart contracts. However, it is unclear how involved Shipchandler will be in those areas.
“Shamoil’s valuable experience furthers our world-class depth in white collar, securities, and data privacy and cybersecurity law practice in Texas and beyond,” Hilda Galvan, partner-in-charge of Jones Day’s Dallas Office, said in the firm’s hiring announcement.
The SEC halted AriseBank’s initial coin offering (ICO) in January 2018 and its CEO was arrested for securities and wire fraud after the company allegedly lied to investors by claiming it could offer Federal Deposit Insurance Corporation (FDIC)-insured bank accounts, credit and debit cards through Visa and other services. In December, the CEO and COO settled charges by agreeing to pay more than $3 million in penalties.
The agency sued 1Broker, also known as 1pool Ltd., and its CEO Patrick Brunner in September for violating the law while selling security-based swaps to U.S. and international investors. “International companies that transact with U.S. investors cannot circumvent compliance with the federal securities laws by using cryptocurrency,” Shipchandler said at the time.
However, a month later the company announced plans to reopen, saying that, although its domain was seized, 1Broker had enough funds to cover all withdrawal requests from its users, though it needed permission from U.S. authorities to start doing so.