Whistleblower: SEC destroyed documents related to 2008 financial crisis investigations

[Brian4Liberty]

Madoff, Goldman Sachs and BofA, oh my.

The final paragraph is telling: SEC enforcement chiefs are former employees of companies being investigated. No conflict of interest there.

Al Capone is running the FBI...

SEC may have destroyed documents, senator says

By Ronald D. Orol, MarketWatch

WASHINGTON (MarketWatch) — The Securities and Exchange Commission may have destroyed documents and compromised enforcement cases involving activity at large banks and hedge funds during the height of the financial crisis in 2008, according to allegations made by a lawmaker on Wednesday.

“From what I’ve seen, it looks as if the SEC might have sanctioned some level of case-related document destruction,” said Sen. Chuck Grassley, Republican of Iowa, in a letter to the agency’s chairman, Mary Schapiro.

“It doesn’t make sense that an agency responsible for investigations would want to get rid of potential evidence. If these charges are true, the agency needs to explain why it destroyed documents, how many documents it destroyed over what timeframe, and to what extent its actions were consistent with the law.”
...
The allegations were made by SEC enforcement attorney, Darcy Flynn, in a letter to Grassley. Flynn is a current employee, and according to the letter, received a bonus for his past year’s work.

Flynn alleges the SEC destroyed files related to matters being examined in important cases such as Bernard Madoff and a $50 billion Ponzi scheme he operated as well as an investigation involving Goldman Sachs Group Inc. GS -1.22% trading in American International Group credit-default swaps in 2009.

Flynn also alleged that the agency destroyed documents and information collected for preliminary investigations at Wells Fargo & Co. WFC -1.52% , Bank of America Corp. BAC -0.57% , Citigroup C -4.32% , Credit Suisse CS -1.80% , Deutsche Bank DB -3.66% Morgan Stanley MS -1.23% and the now-bankrupt Lehman Brothers.

The letter goes into particular detail about Deutsche Bank, the former employer of current SEC enforcement chief Robert Khuzami as well as former enforcement chiefs Gary Lynch and Richard Walker.
...
http://www.marketwatch.com/story/sec...ays-2011-08-17

[HOLLYWOOD]

The digital data and backups would also have to be destroyed, so their were multiple directives sent out. That means the SEC secondary digital mirrored sites too. NSA can recover much of the Digital Data if given the chance to conduct forensics on their systems.

If this has all been intently wiped to hide any possible recovery, then it would be intent to conceal criminal evidence. unfortunately, this will be another protective umbrella of "inaction/ignore" the US A.G. over the establishment fraudsters of government agencies, regulatory agencies, and criminal bankstas/wall st/Capital Hill.

[Brian4Liberty]

The digital data and backups would also have to be destroyed, so their were multiple directives sent out. That means the SEC secondary digital mirrored sites too. NSA can recover much of the Digital Data if given the chance to conduct forensics on their systems.

If this has all been intently wiped to hide any possible recovery, then it would be intent to conceal criminal evidence. unfortunately, this will be another protective umbrella of "inaction/ignore" the US A.G. over the establishment fraudsters of government agencies, regulatory agencies, and criminal bankstas/wall st/Capital Hill.

You have to wonder what kind of media the "files" were. Were they ever backed up to a central computer at all? Could the file be hand-written, or print-outs from a laptop where the files were never backed-up? How about recorded interviews that were only stored locally on a memory card?

[buck000]

More details and (really good, imho) stuff from Taibbi at

http://www.rollingstone.com/politics...rimes-20110817
and
http://www.rollingstone.com/politics...t-fly-20110819

Maybe the SEC should open an MUI on themselves...

Clearly, the thing we need to do is establish more regulations/regulators to prevent this sort of thing in the future. Perhaps we need an "SEC Oversight Agency".... </sarcasm>

[Brian4Liberty]

More details and (really good, imho) stuff from Taibbi at

http://www.rollingstone.com/politics...rimes-20110817
and
http://www.rollingstone.com/politics...t-fly-20110819

Maybe the SEC should open an MUI on themselves...

Clearly, the thing we need to do is establish more regulations/regulators to prevent this sort of thing in the future. Perhaps we need an "SEC Oversight Agency".... </sarcasm>

Good stuff. Every "investigation" has to be approved at the highest levels. Interesting and inefficient way to do business, but it would be an obvious sign that the agency is strictly controlled by very few people. Is it a conspiracy, or just everyday reality?

But the SEC, using history-altering practices that for once actually deserve the overused and usually hysterical term "Orwellian," devised an elaborate and possibly illegal system under which staffers were directed to dispose of the documents from any preliminary inquiry that did not receive approval from senior staff to become a full-blown, formal investigation.
...
In at least one case, according to Flynn, investigators at the SEC found their desire to bring a case against an influential bank thwarted by senior officials in the enforcement division – whose director turned around and accepted a lucrative job from the very same bank they had been prevented from investigating.