SEC

Perhaps no government entity is more affected by the new financial regulatory reform act than the Securities and Exchange Commission. On Tuesday, SEC Chair Mary L.

The Securities and Exchange Commission's division that reviews public company filings is creating three specialized offices to enhance its disclosure review and policy operations. 

A tip of the hat to Ashby Jones at the Wall Street Journal Law blog, who just blogged about a letter from the SEC’s Office of Inspector General to Iowa Republican Senator Charles Grassley about recent investigations it has conducted, which letter includes the following mind boggling sentence:

Gerald Hodgkins has been appointed as an Associate Director of the SEC’s Division of Enforcement, a senior position in which he will assist in planning and directing the agency's enforcement efforts.

Now, we’re getting somewhere! The SEC and CFTC are forming a joint committee to address emerging regulatory issues. The joint committee will develop recommendations on emerging and ongoing issues relating to both agencies.

Late last week, while the Securities and Exchange Commission was getting ready to go after Goldman, it released a report by the SEC Office of the Inspector General that was highly critical of the SEC's actions in connection with R. Allen Stanford's alleged Ponzi scheme – a report highly reminiscent of the criticisms the SEC faced following its failure to find the Madoff fraud on a timely basis. 

Here's a link to the SEC's complaint against Goldman Sachs for fraud, stemming from the Abacus CDO the firm marketed before the subprime mortgage collapse:  http://www.sec.gov/litigation/complaints/2010/comp-pr2010-59.pdf.

Goldman Sachs, which was sued today by the SEC for fraud in connection with its marketing of the Abacus CDO, issued a statement responding to the SEC’s complaint. Goldman stated: “The SEC’s charges are completely unfounded in law and fact and we will vigorously contest them and defend the firm and its reputation.”

Earlier this morning, we noted that a story in the New York Times today says that the Financial Crisis Inquiry Commission that Congress created to look into the financial meltdown is wrestling with “setbacks.” Now, we see that the Washington Post says that the SEC is facing “setbacks” (along with skepticism) in its efforts to change its enforcement image. 

We often highlight new government appointments involving the prosecution of white collar crime and financial fraud, as we do when government officials move to private practice. So,when an article begins “The revolving door can turn swiftly at the Securities and Exchange Commission,” you know it’s something that we will find of keen interest here at the Financial Fraud Law blog, and that we want to point out to you.