SEC

Adam Storch was named today to the newly-created position of Managing Executive of the Securities and Exchange Commission’s Division of Enforcement. In this role, Storch will act as the Enforcement Division’s first-ever chief operating officer. He will report to Robert Khuzami, the Director of the Division, who created the position as part of a restructuring he announced earlier this year. 

A complaint was filed yesterday in federal district court in Manhattan against the Securities and Exchange Commission in connection with the Madoff Ponzi scheme.

Harvey Goldschmid, a former commissioner of the Securities and Exchange Commission, today declared that the financial crisis unfolded in part because large sections of the industry were unregulated, while other parts were simply badly regulated, typically by overlapping agencies.

The Office of Inspector General (OIG) is an independent office within the U.S. Securities and Exchange Commission that conducts audits of programs and operations of the Commission and investigations into allegations of misconduct by staff or contractors. The mission of the OIG is to detect fraud, waste and abuse, and to promote integrity, economy, efficiency and effectiveness, in the Commission’s programs and operations.

Detroit-area stockbroker Frank Bluestein has been charged with fraud by the Securities and Exchange Commission, which alleges that he lured elderly investors into a $250 million Ponzi scheme after convincing many of them to refinance their home mortgages.

University of Texas School of Law Professor Henry T. C. Hu has been named Director of the newly-established Securities and Exchange Commission’s Division of Risk, Strategy, and Financial Innovation.

Federal District Court Judge Jed Rakoff has refused to approve the $33 million settlement between the Securities and Exchange Commission and Bank of America over bonuses B of A paid to Merrill Lynch executives after it acquired the brokerage firm last year.

Robert Khuzami, Director of the SEC’s Division of Enforcement, and John Walsh, Acting Director of the SEC’s Office of Compliance Inspections and Examinations went before the U.S. Senate Committee on Banking, Housing, and Urban Affairs today.

Securities and Exchange head Mary L. Schapiro issued a statement today following the SEC’s release of the executive summary of the Inspector General’s report regarding the SEC’s handling of the Bernard Madoff fraud. In that statement, Schapiro recognizes that the report “makes clear that the agency missed numerous opportunities to discover the fraud.” She said it is “a failure that we continue to regret.”

The summary of the OIG report released today by the SEC concludes with this damning paragraph: