SEC Expected to Be Next on DOGE Chopping Block

As Elon Musk and the Department of Government Efficiency (DOGE) continue their efforts to overhaul the federal government, recent developments indicate the project may soon turn its attention to the Securities and Exchange Commission.

On February 17, a DOGE-related account on X made clear that the Securities and Exchange Commission was in the Trump administration’s crosshairs. The account asked members of the public to submit “insights on finding and fixing waste, fraud and abuse” relating to the SEC. Several news outlets have also reported in recent weeks that DOGE representatives are expected to begin their probe at the SEC soon. Citing individuals in the administration who had been briefed on the matter, Politico reported that investigators with DOGE are “at the gates” of the SEC.

Likewise, Reuters reported that the SEC is planning to preemptively remove leaders at regional offices across the country as part of its cost-reduction recommendations to the Trump administration – even before DOGE employees begin exploring potential cuts to staff and funding. The commission reportedly told directors across its 10 regional offices that their positions will be eliminated. The agency had already announced last year that it would close its Salt Lake City Regional Office, which would cut the number of regional offices from 11 to 10.

If DOGE follows the same playbook at the SEC that it has used at other agencies, several hundred of its 5,000 employees are at risk of losing their jobs. Workers who were hired recently and have fewer job protections than senior-level employees could find their employment imperiled in the process.

The remaining SEC staff will be forced to shoulder a much heavier workload should DOGE cut too deep. The Commission has ambitious priorities under the Trump administration, starting with a major focus on developing clear regulatory frameworks for digital assets, including a potential review of existing enforcement actions and creating new rules specifically for cryptocurrency exchanges and related activities. Of course, an initiative like this will require significant manpower, and it’s unclear whether DOGE’s streamlining will account for the work to be done. The same is true of the Trump administration’s plans for increased scrutiny on how firms manage risks associated with emerging technologies like AI and a continued focus on the activities of private fund advisors, particularly regarding strategies sensitive to market volatility and illiquid assets.

One office where staffing reductions appear to align with the SEC’s priorities is the Division of Enforcement. The SEC, under Acting Chair Mark Uyeda, has already indicated that it plans to “deploy enforcement resources judiciously,” an approach that current SEC leadership believes would correct the overly aggressive enforcement posture adopted by the previous administration. Musk, for one, would likely welcome changes at the enforcement division given his previous and ongoing disputes with the agency, including a lawsuit over allegations of inadequate disclosures related to his purchase of Twitter stock shares in 2022, which the SEC claims resulted in a $150 million shortfall for investors.

It shouldn’t take us long to discover whether DOGE has unintentionally torpedoed some of the Trump administration’s plans for the SEC. Regardless, it will be interesting to see if the SEC of a few weeks or a few months from now at all resembles the agency that we’ve come to know over the years.