Senators Accuse Deputy Attorney General of Crypto Conflict
Six U.S. senators have accused Deputy Attorney General Todd Blanche of a glaring conflict of interest after an investigation revealed he owned at least $159,000 in crypto-related assets when he shut down probes into cryptocurrency companies and disbanded a key enforcement team.
The Allegations and Evidence
In a letter sent this week, Democratic Sens. Elizabeth Warren, Dick Durbin, Mazie Hirono, Sheldon Whitehouse, Christopher Coons, and Richard Blumenthal cited a ProPublica investigation. They stated that Blanche's actions appeared to violate federal conflict of interest laws, as he made decisions that could financially benefit his own investments.
Blanche had signed an ethics agreement in February, promising to divest his cryptocurrency within 90 days of confirmation and avoid matters affecting his financial interests until sold. However, on April 7, before divesting, he issued a memo titled "Ending Regulation by Prosecution" that halted investigations launched under President Joe Biden and disbanded the National Cryptocurrency Enforcement Team.
Impact and Consequences
The senators argued that this policy shift has led to a surge in illicit cryptocurrency activities in 2025, including crimes tied to money laundering and human trafficking, as noted in an independent report. They also questioned whether Blanche's decisions were influenced by President Donald Trump's financial interests in cryptocurrency, given Trump's history of pardoning crypto-related criminals.
A Justice Department spokesperson claimed Blanche's actions were "appropriately flagged, addressed and cleared in advance," but did not provide details. The senators have demanded answers by February 11, including written determinations on the legality of his actions and all related communications.
Legal and Ethical Scrutiny
Kedric Payne of the Campaign Legal Center filed a complaint with the Justice Department's inspector general, alleging Blanche's orders violated the law by broadly benefiting the crypto industry, including his investments. Payne estimated that Blanche's bitcoin holdings alone rose by 34% after the memo was issued.
Under federal law, officials face penalties ranging from fines to up to five years in prison for willful violations of conflict-of-interest statutes. The senators emphasized that the public deserves transparency to ensure decisions are made in the public's best interest, not for personal gain.
Blanche, a former federal prosecutor who defended Trump in high-profile cases, now faces expanded investigations into potential ethics violations and false statements on compliance forms.
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