SEC knew of Stanford scheme since 1997, inspector general says

Source: AP, Cleveland Plain Dealer

SEC knew of Stanford scheme since 1997, inspector general says
By Associated Press business staff
April 16, 2010, 3:11PM

Updated at 4:44 p.m.

WASHINGTON -- The Securities and Exchange Commission knew since 1997 that R. Allen Stanford likely was operating a Ponzi scheme and an agency enforcement official who helped quash investigations of his business later represented the billionaire, according to a new report by the SEC inspector general.

The SEC didn't bring charges against Stanford until February 2009, when it alleged a $7 billion fraud. The SEC inspector general also said in a report released Friday that "institutional influence" in the enforcement division was a factor in the agency's repeated decisions not to conduct a full investigation.

Complex cases like Stanford's that couldn't be quickly resolved were discouraged by enforcement higher-ups, the IG's report said.

The report by Inspector General David Kotz said his office's examination didn't find that the reluctance of the SEC's Fort Worth enforcement attorneys to investigate Stanford was tied to "any improper professional, social or financial relationship on the part of any former or current SEC employee."

The IG's office did find evidence, however, that "institutional influence" within the enforcement division contributed to the repeated decisions not to conduct a thorough investigation of Stanford, the report says. Senior agency officials in the Fort Worth office believed they were being judged on the number of cases they brought, and told their enforcement staff that novel or complex cases -- as opposed to "quick-hit" cases -- were discouraged, the IG's inquiry found.

(more)

Read more: http://www.cleveland.com/business/index.ssf/2010/04/sec_knew_of_stanford_scheme_si.html

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Nobody could have seen this shit coming! Nobody I, tell ya!

Ever since the Raygun Catastrophe, this country has forgotten how to govern itself or regulate anything.

unfettered capitalism, all a genesis of the recent financial meltdown and depression, all which will ignored in the rush to enshrine the gipper's likeness on the $50 bill. :P

That would be fitting and perfectly symbolize the fake economics and dishonest tenure of this lousy president. Also would make it easier to spot and reject!

It's much easier throwing little fish in the can. They must like Sardines.