Staff Open Meeting - April 16, 2026
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What is the purpose of the staff open meeting and the item being moved to discussion?
All right. So we have I guess welcome to the uh uh real quick staff open meeting uh this morning and uh we'll go ahead and call it to order. Um Vice Chair Walden, you wanna move the one item we have today?
Yes, thank you. I move item one for discussion.
All right, securities. Uh good morning, Chair, Vice Chair, and Commissioners. Thank you for scheduling the staff meeting on such short notice. All of you have busy schedules today, so I'll be brief. As you know, the Federal Digital Asset Manag Market Clarity Act, also known as the Clarity Act. Is currently pending before the US Senate Banking Committee. I've been informed that markup of the bill is tentatively set for next week.
How does the Federal Digital Asset Market Clarity Act potentially affect Arizona’s securities enforcement authority?
This is a complicated bill that covers many areas. However, the issue we're raising with you is a simple one. There's substantial concern. That the current language of the bill could be used to argue that state securities regulators, such as the Commission, are preempted from investigating and enforcing fraud issues on matters covered by the Clarity Act. In other words, if the Clarity Act passes in its current form If an Arizona investor is then defrauded on a security covered by it, the Commission might not be able to investigate, enforce or get restitution for that defrauded investor. We would probably not even be able to go to court to stop the entity from defrauding other investors. The Commission would lose its authority and jurisdiction to stop those types of actions and to protect its constituents.
In response to this, the Commission Securities Association, the North American Securities Administrators Association, and state regulators have brought this issue to the attention of the Senate. Last month, thirty one states as diverse as Mississippi, Ohio, New Mexico, and Nevada signed a letter raising those concerns. Due to logistical and time constraints, we were not able to bring it to the Commission at that time. However, with bill markups scheduled for next week, there's another opportunity to raise our concerns. Several other states who were also not able to sign are now considering joining in.
Why are state regulators urging the Commission to sign the March‑12 letter to the Senate Banking Committee?
I should be clear on one point. We're not asking the Commission to stand to take a stand or opine on the substance of the Clarity Act. We're not looking to expand our jurisdiction. All we're seeking is to have it made clear that the bill does not take away the Commission's jurisdiction to protect the citizens of Arizona from securities fraud. Thus, I ask the Commission to authorize the Securities Division to sign on to the March twelfth letter, which has previously been provided to your offices. For that acknowledgement to be sent to Congress and to allow us to continue to assist and protect Arizona citizens from fraud. Thank you.
All right, thank you. Uh Commissioner questions, comments, uh Commissioner Marcus Peterson.
No, thank you very much. Uh thank you for your due diligence and paying attention to this issue so closely. I think it's important and we'll be supporting your efforts.
All right, Mr.
What concerns did Commissioners raise about jurisdiction if the Clarity Act passes as written?
Thompson? I have no questions. Thank you, Mark. Uh Vice Chair Walden.
I seem to be having technical issues. I I apologize for that. The screen went out. Um, I don't have any questions. I think that it will be uh important that we send this letter and be part of this effort to keep the state's ability to to go after fraud on our own. And um I agree with everything that Mr. Janelle said.
Okay, thank you.
How did the Commissioners respond to the request to join the multi‑state letter?
Um Commissioner Lopez? All right. Um I I I'm going to be in support of this as well, but I do have a a question of what if, and that is what if it does pass? What who regulates that at that point?
If the Clarity Act passes as written, um the primary agencies that have jurisdiction would be the SEC and the CFTC. As as I say it's not crystal clear that we don't have jurisdiction, but there are enough questions raised that we might not. What I suspect would happen is we bring we would try to bring an enforcement case against someone and they would immediately argue that we're preempted and we would be in court for a while on that issue, if not some other state.
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Agenda
7 items
1
What is the purpose of the staff open meeting and the item being moved to discussion?
0:00–0:52
2
How does the Federal Digital Asset Market Clarity Act potentially affect Arizona’s securities enforcement authority?
0:52–2:32
3
Why are state regulators urging the Commission to sign the March‑12 letter to the Senate Banking Committee?
2:32–3:30
4
What concerns did Commissioners raise about jurisdiction if the Clarity Act passes as written?
3:30–4:02
5
How did the Commissioners respond to the request to join the multi‑state letter?
4:02–5:10
6
What motions and votes were made to approve the Commission’s participation in the letter?
5:10–6:04
7
What was the final outcome of the meeting and the next steps for the Commission?
6:04–6:44
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