SEC lawyers smart enough to run scams themselves, probe contends
Whistleblower Harry Markopolos was dead right about Bernie Madoff but maybe he spoke too soon when he blasted the SEC for having too many lawyers who are ignorant about how scams work.
As CBS News reports, the FBI is probing two high-level SEC lawyers for supposedly using insider info about SEC probes to trade stocks.
"They ought to be prosecuting, not profiteering," an angry Senator Chuck Grassley was quoted as saying.
Here's the SEC Inspector General report that CBS got its hands on. More from the story:
According to the report, the male attorney under investigation by the FBI works in the Office of the SEC's Chief Counsel and "has access to a tremendous amount of nonpublic information."
The report alleges both the male attorney and female attorney - who works in the enforcement division - "traded in the stock of a large financial services company" despite being told by another SEC employee of ongoing "investigations of that company." The report calls this is a direct violation of SEC rules.
In another possible violation, the male attorney was found to have sent e-mails from his SEC account to his brother and sister-in-law "recommending particular stocks." The attorney's stock portfolio was estimated at one point to be valued at $200,000.
