Post by jcline on Dec 7, 2006 10:15:47 GMT -4
Sent to a mass of Regulators and officials today....including NASD and SEC commissioners....
The wheels are coming off this bus faster than you can say "captured regulators"!!!! The sad thing is, this is no different than what the head of the SEC union stated to me several years ago as I picketed out in front of the old SEC building one day in July. "The SEC works for Wall Street and takes all direction from them" was what this gentlemen had to say. He eventually said the same to Dateline NBC before Wall Street pressured that program not to show.
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Is the SEC afraid of the elite on Wall Street?
By David Weidner, MarketWatch
Last Updated: 12:01 AM ET Dec 7, 2006
NEW YORK (MarketWatch) -- If you watched any of the Senate Judiciary Committee hearings concerning former Securities and Exchange Commission investigator Gary Aguirre you know that he can turn a yes-or-no question into a 50-page legal brief.
On Capitol Hill and in private, the long-winded Aguirre has a lot to say to defend himself, but he doesn't want to be the one to do it. He wants his work to speak for itself. He wants his former colleagues to back him up. He wants the hearings to be the place where reputation is salvaged.
"I'm not going to be my own character witness," Aguirre said when I asked him to defend himself against charges by former bosses that he was "unprofessional" and prone to "disagreements."
"I'm looking for the truth to come out through the Senate investigation," Aguirre said.
Get Aguirre to talk and he levels a very big charge: the SEC bows to big shots on Wall Street. These congressional hearings have never been about Aguirre's investigation into Pequot Capital and insider trading -- that investigation was really in its infancy when it was killed. Aguirre hasn't said John Mack or Pequot Capital Management's Arthur Samberg were guilty of anything.
The issue is not the conduct of Aguirre but the conduct of SEC branch manager Robert Hanson, former SEC associate enforcement director Paul Berger, SEC assistant director Mark Kreitman and ultimately Linda Thomsen, the commission's director of enforcement.
"We can't have two sets of securities laws, one set for those with political connections or those with the right contacts and another set for the rest of us," Aguirre said in an interview. When evidence points the SEC to powerful people, he added "The umpire is looking the other way when he ought to be calling the violation. That's what I had been saying to the senate."
A history of SEC criticism
Aguirre isn't alleging anything new. For as long as there has been an SEC, there's been criticism that the commission is soft on Wall Street and favors the big banks it's supposed to be policing. Big shots at the level of Morgan Stanley's (MS: News <javascript:MktWatch_span_getNews('617446448-CU')>, Quote <javascript:MktWatch_span_doDD('24', '617446448-CU')>) Mack are said to enjoy special protection.
That criticism has ramped up in recent years as New York State Attorney General Eliot Spitzer took the lead on key investigations into tainted stock research, mutual fund trading abuses and compensation at the New York Stock Exchange. The SEC caught in the transition between Harvey Pitt and William Donaldson.
It's hard to think of an investigation that has brought down a major Wall Street figure since Rudy Giuliani prosecuted Michael Milken in 1989. Only Spitzer's investigations, which netted such figures as Richard Strong of Strong Capital Management and Marsh & McLennan's (MMC: News
Jeffrey Greenberg and others really come close.
Even some of the SEC's marquee cases didn't originate there. Questionable backdating of stock options was revealed by The Wall Street Journal. Corporate governance advocates have been pressing for more disclosure of executive pay for years. Enforcement cases at the SEC have declined for three years in a row.
Aguirre's windmill
Enter Aguirre, a former trial attorney. Those close to him say he was inspired by a letter saying that lawyers had a "special role in our society." It was written to him by Robert Kennedy shortly before his death in 1968.
Whether it be his testimony or his letters to SEC brass, it doesn't require a lot of imagination to see why he rubbed his bosses the wrong way. Aguirre is at times stubborn and combative. He believes his protest is a moral issue.
In his defense, those same critical bosses also had awarded Aguirre a big raise and glowing review shortly before the SEC machine appears to have turned into something out of a John Grisham novel.
Former SEC investigators and attorneys have rushed to the defense of the commission. They say the commission was unafraid of pursuing the powerful. But many of those defenders worked during a different time. Two of his colleagues, including L. Hilton Foster, one of the commission's foremost experts on insider trading, have testified on his behalf.
Aguirre said he's hoping the Senate Judiciary Committee will rescue what he's lost in reputation. In recent hearings, committee members, led by Sens. Charles Grassley and Arlen Specter, have grilled SEC officials over their treatment of Aguirre and have criticized the commission's practices.
Fate in the hands of Congress
Most everyone was skeptical when congress took up Aguirre's fight this fall. But the hearings have eroded the commission's integrity. Two more SEC officials including Eric Ribelin, branch chief of the SEC's office of market surveillance, have backed Aguirre's side of the story. Ribelin said "something smelled rotten."
In a statement sent to me by the senator's office Spector said "It wasn't rotten. It was smell...He was doing outstanding work -- whatever language that was -- and then they manufactured a reevaluation as the basis for firing him. Totally, totally unjustified." He said the SEC's actions have "an overtone of a coverup."
Until the committee issues its report in February, the Government Accountability Office has signed off on an investigation into the SEC's enforcement division. Maybe Aguirre will throw "tantrums," storm out of the house and sneer at his dog.
In the end, it doesn't really matter if we believe Gary Aguirre. What matters is if we believe the SEC.
David Weidner covers Wall Street for MarketWatch.
The wheels are coming off this bus faster than you can say "captured regulators"!!!! The sad thing is, this is no different than what the head of the SEC union stated to me several years ago as I picketed out in front of the old SEC building one day in July. "The SEC works for Wall Street and takes all direction from them" was what this gentlemen had to say. He eventually said the same to Dateline NBC before Wall Street pressured that program not to show.
=========
Is the SEC afraid of the elite on Wall Street?
By David Weidner, MarketWatch
Last Updated: 12:01 AM ET Dec 7, 2006
NEW YORK (MarketWatch) -- If you watched any of the Senate Judiciary Committee hearings concerning former Securities and Exchange Commission investigator Gary Aguirre you know that he can turn a yes-or-no question into a 50-page legal brief.
On Capitol Hill and in private, the long-winded Aguirre has a lot to say to defend himself, but he doesn't want to be the one to do it. He wants his work to speak for itself. He wants his former colleagues to back him up. He wants the hearings to be the place where reputation is salvaged.
"I'm not going to be my own character witness," Aguirre said when I asked him to defend himself against charges by former bosses that he was "unprofessional" and prone to "disagreements."
"I'm looking for the truth to come out through the Senate investigation," Aguirre said.
Get Aguirre to talk and he levels a very big charge: the SEC bows to big shots on Wall Street. These congressional hearings have never been about Aguirre's investigation into Pequot Capital and insider trading -- that investigation was really in its infancy when it was killed. Aguirre hasn't said John Mack or Pequot Capital Management's Arthur Samberg were guilty of anything.
The issue is not the conduct of Aguirre but the conduct of SEC branch manager Robert Hanson, former SEC associate enforcement director Paul Berger, SEC assistant director Mark Kreitman and ultimately Linda Thomsen, the commission's director of enforcement.
"We can't have two sets of securities laws, one set for those with political connections or those with the right contacts and another set for the rest of us," Aguirre said in an interview. When evidence points the SEC to powerful people, he added "The umpire is looking the other way when he ought to be calling the violation. That's what I had been saying to the senate."
A history of SEC criticism
Aguirre isn't alleging anything new. For as long as there has been an SEC, there's been criticism that the commission is soft on Wall Street and favors the big banks it's supposed to be policing. Big shots at the level of Morgan Stanley's (MS: News <javascript:MktWatch_span_getNews('617446448-CU')>, Quote <javascript:MktWatch_span_doDD('24', '617446448-CU')>) Mack are said to enjoy special protection.
That criticism has ramped up in recent years as New York State Attorney General Eliot Spitzer took the lead on key investigations into tainted stock research, mutual fund trading abuses and compensation at the New York Stock Exchange. The SEC caught in the transition between Harvey Pitt and William Donaldson.
It's hard to think of an investigation that has brought down a major Wall Street figure since Rudy Giuliani prosecuted Michael Milken in 1989. Only Spitzer's investigations, which netted such figures as Richard Strong of Strong Capital Management and Marsh & McLennan's (MMC: News
Jeffrey Greenberg and others really come close.
Even some of the SEC's marquee cases didn't originate there. Questionable backdating of stock options was revealed by The Wall Street Journal. Corporate governance advocates have been pressing for more disclosure of executive pay for years. Enforcement cases at the SEC have declined for three years in a row.
Aguirre's windmill
Enter Aguirre, a former trial attorney. Those close to him say he was inspired by a letter saying that lawyers had a "special role in our society." It was written to him by Robert Kennedy shortly before his death in 1968.
Whether it be his testimony or his letters to SEC brass, it doesn't require a lot of imagination to see why he rubbed his bosses the wrong way. Aguirre is at times stubborn and combative. He believes his protest is a moral issue.
In his defense, those same critical bosses also had awarded Aguirre a big raise and glowing review shortly before the SEC machine appears to have turned into something out of a John Grisham novel.
Former SEC investigators and attorneys have rushed to the defense of the commission. They say the commission was unafraid of pursuing the powerful. But many of those defenders worked during a different time. Two of his colleagues, including L. Hilton Foster, one of the commission's foremost experts on insider trading, have testified on his behalf.
Aguirre said he's hoping the Senate Judiciary Committee will rescue what he's lost in reputation. In recent hearings, committee members, led by Sens. Charles Grassley and Arlen Specter, have grilled SEC officials over their treatment of Aguirre and have criticized the commission's practices.
Fate in the hands of Congress
Most everyone was skeptical when congress took up Aguirre's fight this fall. But the hearings have eroded the commission's integrity. Two more SEC officials including Eric Ribelin, branch chief of the SEC's office of market surveillance, have backed Aguirre's side of the story. Ribelin said "something smelled rotten."
In a statement sent to me by the senator's office Spector said "It wasn't rotten. It was smell...He was doing outstanding work -- whatever language that was -- and then they manufactured a reevaluation as the basis for firing him. Totally, totally unjustified." He said the SEC's actions have "an overtone of a coverup."
Until the committee issues its report in February, the Government Accountability Office has signed off on an investigation into the SEC's enforcement division. Maybe Aguirre will throw "tantrums," storm out of the house and sneer at his dog.
In the end, it doesn't really matter if we believe Gary Aguirre. What matters is if we believe the SEC.
David Weidner covers Wall Street for MarketWatch.