Tags : bernie madoff, SEC
SEC Missed “Numerous” Opportunities To Catch Madoff Scheme
Washington, D.C. (AHN) – The head of the Securities and Exchange Commission said Wednesday that the agency missed “numerous opportunities” to uncover the $65 billion Ponzi scheme conducted for decades by Bernard Madoff.
The remarks by SEC chairman Mary Shapiro came as the agency’s Inspector General, David Kotz, released a report that found the SEC had “more than ample information” that should have prompted an in-depth investigation of Madoff’s investment firm, Madoff Investment Securities LLC.
Shapiro said Kotz’s finding “makes clear that the agency missed numerous opportunities to discover the fraud. It is a failure that we continue to regret, and one that has led us to reform in many ways how we regulate markets and protect investors.”
Kotz said that during the time Madoff operated his investment company, the SEC received “six substantive complaints that raised significant red flags” and “should have led to questions about whether Madoff was actually engaged in trading.”
The inspector general’s report did not find that any senior SEC officials acted improperly or tried to influence the investigation.
Madoff surrendered to federal authorities in December and in March pleaded guilty to fraud that affected thousands of investors. He is serving a 150-year sentence.
Congressional watchdogs had awaited the IG’s report to determine the type of legislation to craft to deter future happenings.
Shapiro said the SEC had already proposed a series of new regulations and had issued twice as many temporary restraining orders to other possible Ponzi schemes as a year ago.
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