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Another week, another tale of gross incompetence, bureaucratic bumbling, stupidity, laziness, and arrogance at the SEC.This time, it comes from Eric Kolchinsky, an executive at Moody's, who called the SEC in September to warn the agency that his company might be committing securities fraud. Ya know, the kind of the thing you'd think the SEC would be interested.
Kolchinsky told the SEC that the company was signing off on mortgage backed securities it knew were not safe -- and the SEC said they'd call him back, but they never did.
According to the Washington Post, "Kolchinsky is one in a series of whistleblowers who in recent years tried to tip off the SEC to potential wrongdoing, only to be ignored, misunderstood or left to wonder whether they were being listened to. The SEC has no system in place to guide how officials should handle tips and complaints from outsiders, making it difficult for investigators to take advantage of an invaluable source of information."
The worst part is that, while ignoring legitimate complaints from whistleblowers, the SEC wasted resources combating the imaginary dragon of manipulative short-selling: interfering with the work of one of the groups of investors that has always provided a much-needed critical response to the hype that emanates from Wall Street.
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Reader Comments (Page 1 of 1)
1-22-2010 @ 3:14PM
BHarrison said...
it is well past time for there to be a purge of the incompetents (or even worse) at the SEC.
We are simply too far along in all of this to still be dealing with incompetent managment and personnel at the SEC.
The President is the Cheif Executive Officer of our Executive Branch of our government. It is his difuciary responsibility to deal direcly with these problems of incompetence in the SEC. Obama needs to take immediate actions to address this incompetence . . . isn't that one of teh responsibilities of the President?