CommunityMy FDLSeminal

Wall Street Journal “Carries Water” for Chris Cox and Bush’s SEC

Shorter Chris Cox: "Responsibility and accountability are for the little people."

SEC to Probe Its Ties to Madoffs

The Securities and Exchange Commission will examine the relationship between a former official at the agency and a niece of financier Bernard L. Madoff, after the SEC’s chief admitted "apparent multiple failures" to oversee the firm at the center of an alleged $50 billion Ponzi scheme.In an extraordinary admission that the SEC was aware of numerous red flags raised about Bernard L. Madoff Investment Securities LLC, but failed to take them seriously enough, SEC Chairman Christopher Cox ordered a review of the agency’s oversight of the New York securities-trading and investment-management firm. The review will include whether relationships between SEC officials and Mr. Madoff or his family members had any impact on the agency’s oversight.

"I am gravely concerned" by the agency’s regulation of the firm, Mr. Cox said.

Mr. Madoff’s niece, Shana Madoff, married a former SEC attorney named Eric Swanson last year. Mr. Swanson worked at the SEC for 10 years, including as a senior inspections and examination official, before leaving in 2006. Ms. Madoff is a compliance lawyer at the securities firm.

Among Mr. Swanson’s duties was supervising the SEC’s inspection program in charge of trading oversight at stock exchanges and electronic-trading platforms, according to a press release from Bats Trading Inc., an electronic stock exchange that hired Mr. Swanson as general counsel earlier this year.

Neither person is named in the SEC statement as a target of the probe, which is being led by the agency’s inspector general, David Kotz. But Mr. Kotz said in an interview that he intended to examine the relationship between Mr. Madoff’s niece and Mr. Swanson.

In a statement Tuesday night, a spokesman for Mr. Swanson acknowledged that "the compliance team he helped supervise made an inquiry about Bernard Madoff’s securities operation," without being more specific. He said the couple began dating in 2006, and were married in 2007.

A second representative of Mr. Swanson said the romantic relationship with Ms. Madoff began "years after" the regulatory scrutiny in which Mr. Swanson was involved. Mr. Swanson will "fully cooperate" with the SEC investigation, the representative said.Ms. Madoff couldn’t be reached for comment. […]

Previous post

Bad Economy, Decreased Services Force More Vets into Homelessness

Next post

Why Throwing Shoes Is Not Enough