According to the Project on Government Oversight, the Securities and Exchange Commission has too loose of a revolving-door policy. The independent nonprofit issued a report early this month and is calling on the agency and Congress to “strengthen and simplify” restrictions post-employment.
POGO says that even though the SEC appears to have strict restrictions when it comes to former employees representing entities that the Commission oversees, many ex-employees can start representing clients within days of resigning from the SEC as long as they submit a post-employment statement.
POGO says it reviewed five years of post-employment statements submitted by ex-SEC employees who wanted to represent a client within two years of resigning from the federal agency. Between 2006 and 2010, 789 ex-employees filed post-employment statements noting their plans to represent an outside client before the SEC. 131 employers were named on these statements. The firms that recruited the most ex-SEC employees during this time were ACA Compliance Group, Deloitte & Touche LLP, Ernst & Young, O’Melveny & Myers, LLP, Wilmer Cutler Pickering Hale and Dorr, LLP, DLA Piper, KPMG, LLP, Morrison & Foerster, LLP, FTI Consulting, Inc., Kirkpatrick & Lockhart Preston Gates Ellis, LLP, and Sidley Austin, LLP.
In addition to simplifying and strengthening post employment restrictions, POGO says that SEC and Congress need to:
• Verify the accuracy and completeness of the statements.
• Allow post-employment statements to be made publicly accessible online.
• Publicly disclose the commission’s ethics waivers and recusal database
• Utilize and strengthen ethics enforcement authority.
• Review confidential treatment procedures and Freedom of Information Act Exemptions.
• Make post-employment restrictions also applicable to other financial regulators.
Our securities fraud attorneys represent institutional investors in the US and abroad.
More Blog Posts:
Impartiality of SEC Report by Boston Consulting Group Questioned by Key House Republicans, Institutional Investors Securities Blog, March 30, 2011
SEC Adopts New Rules Regarding Shareholder Say-On-Pay, Institutional Investors Securities Blog, January 29, 2011
SEC to Up Dollar Thresholds for When an Investment Adviser Can Charge Investors Performance Fees, Stokbroker Fraud Blog, May 24, 2011
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