Due Diligence

Consumer Group Says SEC Slow on Reform

Over a year after the Bernie Madoff swindle blew up, the SEC has not made enough progress on promised fraud and enforcement reforms, a report released last week by Citizens for Responsibility and Ethics in Washington (CREW) finds.

The report says the SEC has made progress on some fronts, like the establishment of “specialized units” and “expanding training.” But the snail’s pace with which it is approaching other shortcomings is hard to understand, says the report.

“Why, for example, will it take the SEC years to establish an appropriate and effective database? Moreover, while the SEC can point to some progress such as its recent lawsuit against Goldman Sachs, its inspector general continues to document other missed opportunities, such as Robert Allen Stanford’s Ponzi scheme, that have caused great economic harm. At bottom, the central question of whether the SEC has instituted significant and effective reforms to address the systemic problems uncovered in the wake of Mr. Madoff’s undetected Ponzi scheme still cannot be answered.”

For the full report, go here.

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