(Bloomberg) -- Elizabeth Warren and other Senate Democrats have set their crosshairs on some of the biggest names behind SPACs, questioning whether the once red-hot market will trigger outsized losses for retail investors.  

In letters to six prominent operators of special purpose acquisition companies, the lawmakers highlighted concerns that insiders can take advantage of regulatory loopholes at the expense of shareholders. 

The missives, which requested information about how executives are compensated and how they solicit investments, were sent to: Howard Lutnick, chief executive officer of Cantor Fitzgerald; Michael Klein, a former star Citigroup Inc. banker, Tilman Fertitta, the billionaire owner of the Houston Rockets, serial SPACer and former Facebook Inc. executive Chamath Palihapitiya, David Hamamoto, whose blank-check company merged with Lordstown Motors Corp. and Stephen Girsky, who was instrumental in the deal to take electric truck startup Nikola Corp. public. 

“We are concerned about the misaligned incentives between SPACs’ creators and early investors on the one hand, and retail investors on the other,” Senators Warren, Sherrod Brown, Tina Smith and Chris Van Hollen said in a Wednesday statement. 

SPACs have mushroomed over the past couple of years, attracting huge amounts of money from small-time investors who see them as way to get in early on young companies that could be future tech stalwarts. Amid the rush, some insiders have found creative ways to get rich even when public shareholders don’t. 

The letters referenced a June Bloomberg article that detailed how Lutnick, Klein and Fertitta benefited from their own SPACs. Klein’s offerings, for example, hired his own investment bank for consulting services, lining the dealmaker’s pockets with millions of dollars in fees. 

Read More: The SPAC Man Method: Lutnick, Klein and the Rush for Riches

At the time, a spokesman for Klein declined to comment on the fees and an executive at Fertitta’s empire defended the SPAC. A representative for Cantor said the Bloomberg article showed “a lack of understanding of the SPAC business.”

The senators’ scrutiny could inform legislative and regulatory responses to SPACs, which have been an increasing focus this year for the U.S. Securities and Exchange Commission and other agencies. The lawmakers are all members of the Senate Banking Committee, which handles policies related to the financial industry. They requested a response to the letters by Oct. 8. 

While getting bills through the bitterly divided Congress is difficult, there is at least some bipartisan agreement that blank-check companies need tighter oversight. Republican Senator John Kennedy, who also sits on the banking panel, introduced legislation in April that would require stepped up disclosures for SPAC founders. 

Executives and academics that advise the SEC have also said they want more transparency. The advisory group recommended earlier this month that the regulator conduct and publish an analysis of the SPAC industry and “more intensively” regulate listings. 

Read More: Why the Hot SPAC Market Has Started to Cool Down

Information Warren and the other lawmakers sought, includes: 

  • A list of SPACs the executives have been involved with.
  • The past or projected financial performance of acquisition targets.
  • Whether the SPACs or their acquisition targets have business relationships with other entities the executives have financial stakes in.
  • A list of any lawsuits and regulatory investigations involving the SPACs the executives founded and the same legal matters tied to target companies.

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