|  | | 2009 News and Press Releases | | |
HEADLINE NEWS:
New Enforcement Chief Aims to Restore Confidence in SEC, Khuzami Looks To Scrub Tarnish From Agency
Jenna Greene
The National Law Journal. October 20, 2009
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EXCERPT: If there's one thing Robert Khuzami learned from his experience prosecuting the first World Trade Center bombers in 1995, it's this: "Whether you're dealing with terrorism or securities fraud, it's better to be in the prevention business than the cleanup business." As the top cop at the U.S. Securities and Exchange Commission, Khuzami has spent his first six months as the director of the Division of Enforcement tackling a cleanup of major proportions. He's undertaken what many call the most sweeping changes of the division in 30 years, a top-to-bottom overhaul of how the agency detects and prosecutes wrongdoing in the financial marketplace. He figures he's succeeding, he said, if the SEC starts bringing cases that aren't front-page news and involve small sums of money. "It means the conspiracies aren't as far along," he said in a lengthy interview. "We want to be better able to detect wrongdoing earlier in the cycle and minimize harm to investors." But the SEC isn't there yet. The agency has faced sharp criticism over the collapse of the subprime-mortgage market, the demise of several major investment banks and, most of all, Bernard Madoff's $50 billion Ponzi scheme. For the thousands of people who lost their life savings as a result of Madoff's scheme, the SEC's failure has triggered profound anger and disappointment -- not to mention a $2.4 million lawsuit against the agency for negligence filed by two victims last week. Now, under intense scrutiny from members of Congress and the SEC's own inspector general, the agency has come to a watershed moment. "There's no denying the fact that the Madoff tragedy was a terrible event, a situation where we should have performed better," Khuzami said. |
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