New York AG Letitia James warned the Clarity Act would weaken states' power to prosecute crypto fraud, urging Congress to strengthen AML, ethics and investor protection rules

The July 22 text does not hand rug pullers blanket immunity: Section 10111 preserves generally applicable state fraud and consumer-protection laws, while Section 20109(b) preserves state cases against unregistered actors. James’s stronger point is narrower: CFTC registrants get exclusive federal jurisdiction, forcing states to proceed under the Commodity Exchange Act instead of their own blue-sky statutes, 7 U.S.C. §13a-2.

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