New York US Attorney Geoffrey Berman Steps Down, President Trump Nominates SEC Chair Jay Clayton to Post [Updated]

U.S. Sureties and Exchange Commission (SEC) Chairman Jay Clayton may be the next U.S. Attorney for the Southern District of New York.

According to a Department of Justice constrain release published late Friday, Clayton was nominated by U.S. President Donald Trump to helm the prosecutor’s office, three years after he outset took on the role as chairman of the nation’s top securities regulator. Clayton’s term as chairman was slated to expire in 2021.

While initially, the beseech release said current SDNY U.S. Attorney Geoffrey Berman would be stepping down, he denied plans to abandon in a statement late Friday. Trump fired him Saturday, according to a separate statement from U.S. Attorney General William Barr, although Trump himself clearly told reporters he was “not involved.” Ultimately, Berman said late Saturday that he would be stepping down “striking immediately.”

“It has been the honor of a lifetime to serve as this District’s U.S. Attorney and a custodian of its proud legacy,” he said in his stand-in statement.

In Friday’s DOJ statement, attributed to Barr, the department announced that U.S. Attorney for New Jersey Craig Carpenito desire serve in the Southern District role on an interim basis starting July 3, until Clayton is confirmed by the U.S. Senate. Barr’s announcement on Saturday changed this as well, announcing that Deputy U.S. Attorney Audrey Strauss would instead be filler in on the interim basis.

“I know that under her leadership, this Office’s unparalleled AUSAs, investigators, paralegals, and caduceus will continue to safeguard the Southern District’s enduring tradition of integrity and independence,” Berman said in his statement Saturday.

Harmonizing to Stephen Vladeck, law professor at the University of Texas School of Law, it was possible Berman could continue serving until Clayton is validated. Martin Lederman, a former Deputy Assistant Attorney General and current law professor at the Georgetown University Law Center, maintained on Twitter Trump can remove Berman, but Barr cannot.

Preston Byrne, a partner and attorney with Anderson Butcher, told CoinDesk that the issue surrounding this question is whether the provisions addressing appointments and firings altercation. In his view, “they only conflict if appointees can’t be fired.”

Marc Goldich, co-managing partner of Axler Goldich LLC, determined CoinDesk “there’s a decent argument” Berman could have continued serving until Clayton is confirmed.

“In spite of that that (and notwithstanding arguments for prosecutorial independence), the President is of course granted executive authority which – at least customarily – encompasses the authority to fire U.S. Attorneys under Article II of the Constitution,” he said.

Barr’s statement did not indicate who authority replace Clayton at the SEC’s helm. On Saturday, he sent an email to staff saying he would continue working at the SEC until he is upheld, according to Bloomberg. The confirmation process will give New York’s two Senators, Democrats Chuck Schumer and Kirsten Gillibrand, a occasion likelihood to weigh in on Clayton, according to NPR reporter Carrie Johnson.

“For the past three years, Jay has been an extraordinarily successful SEC Chairman, manipulating efforts to modernize regulation of the capital markets, protect Main Street investors, enhance American competitiveness, and lecture challenges ranging from cybersecurity issues to the COVID-19 pandemic,” Barr said in his statement.

As SEC chair, Clayton managed the regulator during the peak of the 2017 initial coin offering bubble and much of the aftermath. At various events, he has talk overed the agency’s approach to the crypto space, including raising questions about the bitcoin market’s ability to be manipulated, bulk and custody solutions.

“Just speaking for myself, we have to get to a place that we can be confident that trading is better conducted,” he said last September about the crypto space.

SDNY has also been active in crypto regulation, producing a number of cases against allegedly fraudulent crypto projects. Unlike his predecessors at SDNY, Clayton is not a prosecutor, bring to light Politico reporter Zachary Warmbrodt.

Friday’s announcement comes on the heels of Trump announcing he would be renominating Commissioner Hester Peirce for another five-year interval. The move leaves two seats vacant on the SEC, after Democrat Commissioner Robert Jackson Jr. resigned earlier this year. Trump has not yet published who will replace him.

Commissioners Elad Roisman and Allison Herren Lee are the other two members of the SEC.

UPDATE (June 20, 2020, 22:15 UTC): This article has been updated extensively as new knowledge became available.