SEC Will Release Three Reports On Madoff Fraud By September

SEC Will Release Three Reports On Madoff Fraud By September - 6/15/2009

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HEADLINE NEWS:

SEC Will Release Three Reports On Madoff Fraud By September, Congressman Kanjorski Pressured The Agency’s Kotz To Release Research As Soon As Possible
Sara Hansard

InvestmentNews. June 15, 2009
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EXCERPT: Securities and Exchange Commission Inspector General David Kotz plans to release at least three reports in connection with the Madoff Ponzi scheme. Mr. Kotz revealed that information in a letter sent today to House Capital Markets Subcommittee Chairman Paul Kanjorski, D-Pa. Mr. Kanjorski wrote the inspector general today asking him to provide a public update about his investigation into the failure of the SEC to detect Bernard Madoff’s giant scheme. First will be a comprehensive investigative report that will be released no later than Aug. 31 detailing all the examinations and investigations that the SEC has conducted on Bernard L. Madoff Securities LLC of New York from 1992 until the present. The firm conducted a $65 billion Ponzi scheme over many years that was uncovered only late last year after Mr. Madoff confessed to his family about it. The inspector general’s office has interviewed more than 100 witnesses and reviewed millions of e-mails and documents in connection with the investigation, Mr. Kotz said in the letter to Mr. Kanjorski. The inspector general’s office has engaged a consulting firm with expertise in the examination of broker-dealers to assist in determining whether SEC examiners “missed red flags that should have alerted them to the Madoff Ponzi scheme,” Mr. Kotz wrote. Also, the inspector general’s office retained an outside expert in electronic-data restoration to help recover e-mails that may have been deleted, Mr. Kotz wrote. The inspector general’s office will issue two more reports providing specific, detailed recommendations for improving the SEC’s Division of Enforcement and Office of Compliance Inspections and Examinations, Those reports, which will incorporate the findings of the investigative report, will be issued no later than Sept. 30. “Six months have now passed since you began your investigations into the $65 billion Madoff Ponzi scheme,” Mr. Kanjorski wrote in an earlier letter to Mr. Kotz.

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