SEC Appears To Be Whitewashing Wall Street Indiscretions
Rolling Stone reports on claims from an SEC whistleblower that suggest that for almost 20 years the Securities and Exchange Commission (SEC) has been deep-sixing public records. Darcy Flynn, a 13-year veteran SEC attorney responsible for records management, has presented evidence to the SEC inspector general and three congressional committees.
Under a deal the SEC worked out with the National Archives and Records Administration, all of the agency’s records – “including case files relating to preliminary investigations” – are supposed to be maintained for at least 25 years. But the SEC, using history-altering practices that for once actually deserve the overused and usually hysterical term “Orwellian,” devised an elaborate and possibly illegal system under which staffers were directed to dispose of the documents from any preliminary inquiry that did not receive approval from senior staff to become a full-blown, formal investigation….
Two MUIs involving con artist Bernie Madoff vanished. So did a 2002 inquiry into financial fraud at Lehman Brothers, as well as a 2005 case of insider trading at the same soon-to-be-bankrupt bank. A 2009 preliminary investigation of insider trading by Goldman Sachs was deleted, along with records for at least three cases involving the infamous hedge fund SAC Capital….
In at least one case, according to Flynn, investigators at the SEC found their desire to bring a case against an influential bank thwarted by senior officials in the enforcement division – whose director turned around and accepted a lucrative job from the very same bank they had been prevented from investigating. In another case, the agency farmed out its inquiry to a private law firm – one hired by the company under investigation. The outside firm, unsurprisingly, concluded that no further investigation of its client was necessary. To complete the bureaucratic laundering process, Flynn says, the SEC dropped the case and destroyed the files.
7 Responses to “SEC Appears To Be Whitewashing Wall Street Indiscretions”
As I have been saying….apparently upon deaf ears….capitalism is institutionalized corruption unless in has Hammer and Sickle like controls that slash and bang with a violent force when the shady stuff starts happening.
The Capitalists are just getting to big. It is they, not us, whom are choosing our leaders.
@Allen
You do realize that these are the GOVERNMENT officials that you’re trying to get us to trust, right? Other organized crime has to stay in hiding until they die, but even after these guys have been exposed, there’s little to no chance that they’ll be fired, much less face criminal or civil action. In fact they’re rather well protected from lawsuits.
Twenty years covers both your beloved Democrat and Republican administrations. These rip-off artists wouldn’t be getting away with so much without their government protectors.
“These rip-off artists wouldn’t be getting away with so much without their government protectors”
Ain’t that the truth.
Prof-
You attack those whom are exposing the crooks?!
I’m afraid for you Prof.
You are slipping down into that Glenn Beck Tea Party nether world where corny propaganda rules the debate and lies of omission rule the day. A token lie for the ferryman on a one way crossing into the Limbaugh land of the spiritually dead. Take heed! Do not cross Prof! HELL AWAITS YOU THERE!
@Allen
I see. You’re confused. Let’s take it slowly:
Now, in case you’re confused, the SEC is a federal government agency, that falls under the executive branch, meaning, they’re ultimately responsible to the president.
Now, if you read the article, you’ll also find that the whistle-blower is an employee of the SEC. But you might have missed this part, which Kathy highlighted:
That would imply that the senior staff (those closest to the president), were personally choosing cases to drop. Now the SEC is neither a free market or capitalistic company, but a government agency. This is not a breakdown of capitalism. It’s straight up corruption.
Who watches the watchers?
Who do I write to to fix this? Frankly its the kind of thing that undermines our entire nation in a way that terrorists never could. Seriously, someone should be getting shot for this. In the head.
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