It’s hard not to be cynical observing the legal industry, with the revolving door a particular source of suspicion. A white-shoe law firm position, with its plum salary and prestige, seems a fair reward for a long career in government service. But should you really be working for the types of clients that you were just prosecuting? And how do you prove that you’re qualified to switch sides?
A case in point for this ethical dilemma is Ladan Stewart, who left the SEC’s enforcement division to join White & Case. Her departure in February made a splash. According to a press release published by the firm, Stewart headed the SEC’s crypto and cyber litigation unit and worked on some of the agency’s most “complex and programmatically important” actions, which included lightning rod lawsuits against top crypto companies. Now, she’ll be developing a crypto defense practice at her new firm, as she told Bloomberg in an interview.
The transition has been bumpy. I wrote about her appearance on a panel last week, where she stood in as a proxy for her former agency against a duo of crypto lawyers, despite her recent switch. Onstage, Stewart offered a strained defense of the SEC’s definition of a crypto asset security, and how it should be registered, which led to murmurs from the audience and protestations from her fellow panelists.
After publishing my piece, I heard grumbling over how Stewart, or at least White & Case, has framed her role—and relative importance—at the SEC. A source familiar with the matter told me that the title of “head of the crypto and cyber litigation unit” does not exist at the agency. There is a crypto assets and cyber unit at the SEC, but Stewart was never in charge of it. Instead, the unit is run by an attorney named David Hirsch, who has been its chief since October 2022. His deputy, Jorge Tenreiro, is the first named attorney in the SEC’s Coinbase complaint, with Stewart second.
This isn’t to say that Stewart, or White & Case, is misstating her role. The reality is this: The SEC created specialized units within the division of enforcement in 2010 and, in 2017, created a cyber unit, which quickly became preoccupied with crypto. In May 2022, the SEC officially renamed the team the crypto assets and cyber unit and, for the first time, created a separate squad of trial attorneys to work on matters of crypto and cyber, changing focus as needed. Stewart was hired as its supervisor. It was not officially part of the crypto assets and cyber unit, instead operating under the broader trial unit headed by Olivia Choe, and other trial attorneys outside of Stewart’s squad could also work on crypto cases.
As one former staffer described it, Stewart held a middle management position, with Hirsch, Tenreiro, and Choe still at the top. “She was definitely not heading a unit, it was supervising,” the staffer told me, adding that Stewart’s role was akin to assistant director—a title cited in the White & Case press release. “She wasn’t a senior officer.”
As the former staffer explained, this is common in the world of law firms, which often aggrandize the former government positions of their new hires. To state, as White & Case did, that Stewart was “overseeing” the agency’s crypto litigation program is a stretch, implying an outsize position that was enough to rankle some semantic squabblers. Stewart did play a role in key cases, like Coinbase, and supervised crypto-focused trial attorneys. “It struck me as no different from how other firms tout people who maybe weren’t senior officers, but they want to make a splash,” the former staffer told me.
“What I loved about working at the SEC, and now at White & Case, is that my job is to focus on doing good work and not on taking credit,” Stewart said in a statement shared with Fortune. “It was an honor to be asked to lead and build the SEC’s first-ever specialized litigation unit and to work with a team of talented litigators on the agency’s most important and high-profile crypto enforcement matters.”
A spokesperson for the SEC declined to comment.
All of this underscores the familiar story of a former government official leaving public service to reinvent themselves in the private sector, sometimes to the chagrin of their past colleagues, who may not be in a position to speak publicly. I wrote about a similar case with Katie Haun, the former federal prosecutor turned mega VC who ticked off some DOJ compatriots for being billed in news coverage as “D.C.’s top crypto cop.”
And then there’s the question: Who speaks for the SEC? As Stewart said on the panel, she was qualified to talk about enforcement issues, but not necessarily issues of registration. Still, since she was billed as a top crypto voice at the agency, she was the one chosen for the panel—and the person in a position to answer. It’s not easy to seamlessly represent both sides. “Crypto is a train that everybody wants to get on,” said a different former SEC staffer. “But nobody wants to actually pay for a ticket.”
Leo Schwartz
leo.schwartz@fortune.com
@leomschwartz
DECENTRALIZED NEWS
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Nigeria is embroiled in further confusion regarding the government's crypto policies as the central bank denied a report that it will require financial institutions to identify individuals or entities interacting with exchanges. (Cointelegraph)
Hong Kong is preparing for the launch of Bitcoin ETFs later this month, although analysts say demand likely won't mirror the U.S. (Bloomberg)
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