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SEC porn scandal takes heat off Congress
L.A. Times ^ | April 27, 2010 | Michael Hiltzik

Posted on 04/28/2010 1:29:17 PM PDT by La Enchiladita

As I write, our nation is still buzzing about the news flash that finally delivered the truth about why our economy melted down without word one from our crack government regulators.

You know what I'm talking about. Yes, it's the great SEC porn scandal.

Last week, a new memo surfaced from the Securities and Exchange Commission's inspector general stating it had investigated dozens of agency staffers, including supervisors, for surfing the Web for dirty pictures with their government computers and during work hours. The investigations dated back at least to 2008 and targeted some employees with truly heroic habits — one accountant allegedly made 16,000 attempts in a month to access blocked websites from his SEC computer.

Priceless story. "Adults" in Congress and the news business wasted no time connecting the dots. You see, 2008 was when the financial meltdown started. So while the economy burned, these guys fiddled.

...It's true that the SEC was a useless lump during the financial crisis, and for years earlier. The Bernie Madoff fraud, mortgage abuses, ridiculous accounting maneuvers by regulated banks and other public companies, all chugged along without timely or effective action by the nation's securities regulator. So it's proper to pin blame where it belongs.

But the guilty parties aren't on the SEC staff. They're in Congress.

The roots of the problem can be found in the consistent failure of Congress to regulate derivatives — those swaps and other nearly incomprehensible instruments implicated in the collapses of Enron, Lehman Bros., and AIG, and which still cast a shadow over the banking system. (They're also at the heart of the SEC's fraud case against Goldman, Sachs & Co.)

(Excerpt) Read more at latimes.com ...


TOPICS: Business/Economy; Extended News; Government
KEYWORDS: chrisdodd; financialreform; goldmansachs; sec
Some government officials, notably Brooksley Born of the Commodity Futures Trading Commission, warned as far back as the late 1990s that trading in unregulated derivatives had gotten out of control.

Born got slapped down by Alan Greenspan, Robert Rubin and Arthur Levitt, the chairmen of the Federal Reserve, the Treasury, and the SEC, respectively, who argued that too much regulation would stifle the promise of a very profitable financial product line.

Their position got cemented into the Commodity Futures Modernization Act of 2000, which was partially written by lobbyists for derivatives dealers. The CFMA was passed by an overwhelming vote in the House and unanimous consent in the Senate. So who voted for it? Among others: Nancy Pelosi and Barney Frank in the House, and Chuck Grassley in the Senate.

1 posted on 04/28/2010 1:29:18 PM PDT by La Enchiladita
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To: All

Well, I’m not as libertine as Hiltzik. I think porn is more than “dirty pictures” and SEC heads should roll, especially the derelict supervisors.

However, it’s interesting that the Dems voted AGAINST regulation in 2000, now they are the champions of it.


2 posted on 04/28/2010 1:31:54 PM PDT by La Enchiladita
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To: La Enchiladita
But the guilty parties aren't on the SEC staff. They're in Congress.

Ludicrous. Neither entity is doing its job. Fire the SEC heads and vote out congress.

3 posted on 04/28/2010 1:35:30 PM PDT by mlocher (USA is a sovereign nation)
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To: La Enchiladita
I can only imagine what the SEC IT group must have been doing.
4 posted on 04/28/2010 1:36:51 PM PDT by TexasCajun
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To: La Enchiladita
I don't see how that takes any heat off Congress...it just adds to the sleazy party that's running the country right now...illegal aliens, government office porn parties, ACORN election fraud, redistribution "stimulus", etc.

The country is in the toilet, and it lays right at the feet of obama and his progressive posse in Congress.

obama dolls


5 posted on 04/28/2010 1:38:21 PM PDT by FrankR (Standing up against tyranny must start somewhere, or the future will belong to the tyrants.)
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To: La Enchiladita
What did he say? I was watching a movie . . . .


6 posted on 04/28/2010 1:41:02 PM PDT by colorado tanker
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To: La Enchiladita

these agencies employ total butt-heads precisely so they will be able to deploy a distraction when necessary


7 posted on 04/28/2010 1:41:27 PM PDT by Buckeye McFrog
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To: La Enchiladita
'one accountant allegedly made 16,000 attempts in a month to access blocked websites from his SEC computer..

The individual was easily identified. Co-workers described him as "Having bigger forearm muscles than Popeye the Sailor Man."'

8 posted on 04/28/2010 1:47:34 PM PDT by Gorzaloon (CNN:AP:etc:Today, President Obama's stool was firm and well-formed. One end was slightly pointed. ")
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To: La Enchiladita
d SEC heads should roll, especially the derelict supervisors.

I understand ONE person has resigned. wow /s

9 posted on 04/28/2010 1:53:20 PM PDT by Vinnie (You're Nobody 'Til Somebody Jihads You)
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To: Vinnie; All
Here is what I just found: None of the SEC employees who surfed the Web for porn at work will be fired (NY Daily News)
10 posted on 04/28/2010 2:00:53 PM PDT by La Enchiladita
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HERE'S THE BIG ONE THE SEC MISSED "No One Would Listen: A True Financial Thriller" by Harry Markopolos details the author's 8-year long attempt to interest the SEC and any other govt authority in Madoff's Ponzi scheme Markopolos uncovered in 2000. It's a disgrace that SEC agents were being paid hundreds of thousands of tax dollars, on their way to million dollar positions on Wall Street....and are still in the industry.

Keep in mind----these financial geniuses are all "licensed." Financial licenses can be lifted for any number of reasons:

If licensees fail to disclose ownership in investment vehicles.

If licensees fail to file proper documentation with state agencies.

If licensees fail to file reports with State Division of The Treasury.

If licensees fail to file state and federal tax returns (stolen money is taxable).

If licensees fail to pay state and federal taxes on hidden profits.

If licensees fail to account for investment proceeds.

HERE'S HOW JUDGES PREDICATE SENTENCING GUIDELINES:

(1) Amount licensee lost to the Treasury, a pension fund, the taxpayers, state pensioners, etc. (2) What role a licensee had in conspiracy schemes to defraud. (3) Whether a licensee obstructed justice in the course of investigations or, later, during trial.

CONTACT Financial Industry Regulatory Authority (nongovernment regulator of US securities firms)

CALL (866) 776-0800

=======================================

Probably some of the SEC'ers were laying off, looking to get positions w/ Madoff. When you realize the scope of Madoff’s fraud, there is no other conclusion one could draw. Even an imbecile could have determined that Madoff was not making trades......merely sending out falsified statements on outdated computer equipment.

The court appointed trustee looking into Madoff's assets unearthed a labyrinth of interrelated international funds, institutions and entities of almost unparalleled complexity and breadth...... with assets and businesses in 11 places overseas. Madoff traveled overseas frequently, to his villa on the Riviera----those suitcases he carried were probably full of cash .....not leisure wear.

Madoff was running several simultaneous scams:

(1) a Ponzi fraud that made him personally wealthy;

(2) laundering tax-free money for wealthy businessmen posing as philanthropists,

(3) IRS fraud facilitation for wealthy businessmen;

(4) a protection racket (shielding his investors from scrutiny);

(5) laundering tax-free money that was donated to Democrat candidates (campaign fraud).

11 posted on 04/28/2010 2:04:43 PM PDT by Liz (If teens can procreate in a Volkswagen, why does a spotted owl need 2000 acres? JD Hayworth)
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These SEC trough swillers also get several $150,000 pensions and eternal Cadillac helth benefits. Some "retire" while still on the job. How many other govt agencies pay people over 100+ grand a year to do nothing?

NAILING THE SEC--CONGRESSIONAL QUESTIONNAIRE Higher-ups need entry-level employees to help facilitate these frauds. Cong Issa should send out questionnaires to SEC entry-level employees, as follows.

Do you know anyone at the SEC (or other govt agency):

(1) engaged in secret backroom deals?

(2) who falsified work reports labeled “overtime”?

(3) who used two sets of books?

(4) who made computer entries to falsely collect “overtime” that were later deleted?

(5) who list phantom employees that are receiving paychecks at PO boxes?

(6) who took kickbacks from govt vendors?

(7) who wire-transferred govt funds to numbered offshore accounts?

(8) who has hidden equity positions in vendor companies?

(9) who engaged in accounting fraud?

(10) who inserted phony budget line items "building costs, administration, legal fees, upkeep," and the like, into tax-financed budgets?

(11) that (a) loaned, (b) sold, (c) exchanged, (d) or leased gov’t property to insiders?

(12) who did not disclose all their income to the IRS?

(13) that colluded to siphon off and kickback government funds?

(14) who is retiring into another government job?

(15) that gave family members govt jobs and pensions?

(16) who failed to return tax-paid cars, cell phones, electronics, computers, Blackberry's, pagers and the like?

CONSEQUENCES Govt agents returning falsified information could be prosecuted and incur felony charges for first-degree tampering with public records, first-degree offering of a false instrument for filing, fourth-degree grand larceny, and first-degree falsifying of official records.

HARD AND FAST RULE OF CONTRACT LAW Falsified answers would also negate all other govt compensation since the individual did not negotiate in good faith.

12 posted on 04/28/2010 2:11:40 PM PDT by Liz (If teens can procreate in a Volkswagen, why does a spotted owl need 2000 acres? JD Hayworth)
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To: La Enchiladita
Derivatives didn't cause the blow up.

Americans not paying their mortgages caused the blow up.

Ordinary Americans on mainstreet. Middle and working class.

But they are never blamed for anything. After all, some of them vote.

13 posted on 04/28/2010 2:36:44 PM PDT by JasonC
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To: JasonC
Americans not paying their mortgages caused the blow up.

What of lenders who wrote loans which they could not reasonably have expected the borrowers to repay, and then repackaged such loans to hide their toxic nature?

14 posted on 04/28/2010 3:17:35 PM PDT by supercat (Barry Soetoro == Bravo Sierra)
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To: JasonC

And some of them vote early and often.


15 posted on 04/28/2010 4:06:55 PM PDT by La Enchiladita
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To: supercat
They simply expected the collateral to be worth as much as the loan. Then politicians imposed forclosure mortoriums and coercive cramdowns and all the rest of it, stealing the collateral.

Go on defending the mainstreet deadbeats. Populists wouldn't know capitalism if it bit them - oh right, it did, and they hated it and whined and called for the government to come beat up their creditors for them.

Deadbeats and whiners make me sick...

16 posted on 04/28/2010 7:43:40 PM PDT by JasonC
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To: JasonC
They simply expected the collateral to be worth as much as the loan.

In some cases, lenders provided their own appraisers, who signed off on values far above what anyone would be willing to actually pay.

17 posted on 04/29/2010 3:28:50 PM PDT by supercat (Barry Soetoro == Bravo Sierra)
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