Update: Members of Congress send letter to prudential regulators on SAB 121

This week, a group of lawmakers urged the Office of the Comptroller of the Currency, the Federal Reserve Board of Governors, the Federal Deposit Insurance Corporation, and the National Credit Union Administration to clarify “through guidance or other action” that SEC Staff Accounting Bulletin 121 (SAB 121) is not enforceable considering the Government Accountability Office’s (GAO) finding that it constitutes a “rule” for purposes of the Congressional Review Act.

SAB 121 was issued by the staff in the Division of Corporation Finance and the Office of the Chief Accountant to address the accounting by entities that have an obligation to safeguard crypto assets that an entity holds for platform users.

As we shared in the November 3rd edition, the GAO concluded that SAB 121 should have been subject to a 60-day period during which Congress could have disapproved the rule. However, until further actions are taken the guidance in SAB 121 remains applicable.

For more on SAB 121, read our summary, Perspectives on SAB 121 and safeguarding crypto assets.
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