US Sen. Sherrod Brown (D-OH) questioned Securities and Exchange Commission (SEC) Chair, Gary Gensler, about Special Purpose Acquisition Companies (SPACs) and their impact on the market during a Senate Banking, Housing, and Urban Affairs Committee hearing Tuesday.

SPACs, also known as a "blank check company" are publicly traded corporations that have a sole purpose to merge with privately held businesses, enabling the latter to go public as well.

Brown referenced the Lordstown Motor Company (LMC) as an example of the affect SPACs have had in recent times. After the SEC announced an investigation into LMC in July, Brown wrote to the company's recently appointed Executive Chairwoman Angela Strand, asking for her to develop and share a plan for their reform and to work with the areas labor unions who have expertise in auto manufacturing.

"It seems clear there were some outside investors looking at this not as a long-term investment in a community with a proud manufacturing heritage and a talented workforce, but as a way to make a quick buck with no follow-through," said Brown, referencing the case of Lordstown Motors. "Of course there will always be people like that - but that doesn't mean we need to encourage risky financial mechanisms to encourage speculation over long-term investment."

Brown criticized Wall Street, saying that it always seem to win games at the expense of communities in certain states including Wyoming, Louisiana, Rhode Island, Pennsylvania and Ohio. He then questioned Gensler over whether or not SPACs draw in companies that want to please Wall Street.

"Look at Youngstown, Ohio - there is a lot to unpack with what is happening at Lordstown Motors," said Brown. "Whether or not the company is ultimately able to succeed - and I hope it does - it seems clear there were some outside investors looking at this not as a long-term investment in a community with a proud manufacturing heritage and a talented workforce, but as a way to make a quick buck with no follow-through."

Gensler responded by saying the SEC is diving into SPACS involvement with companies similar to LMC.

"So we are looking at greater disclosures and also looking at if there are inherent conflicts along the way," said Gensler. "And then again put this out to notice, and comment, and rule making."