Matt Taibbi has a Rolling Stone article describing how the Securities and Exchange Commission has been destroying evidence from its investigations for almost 20 years.
Under a deal the SEC worked out with the National Archives and Records Administration, all of the agency’s records – “including case files relating to preliminary investigations” – are supposed to be maintained for at least 25 years. 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. Amazingly, the wholesale destruction of the cases – known as MUIs, or “Matters Under Inquiry” – was not something done on the sly, in secret. The enforcement division of the SEC even spelled out the procedure in writing, on the commission’s internal website. “After you have closed a MUI that has not become an investigation,” the site advised staffers, “you should dispose of any documents obtained in connection with the MUI.”
. . .
In at least one case, according to [whistleblowing SEC attorney Darcy] 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. In another case, the agency farmed out its inquiry to a private law firm – one hired by the company under investigation. The outside firm, unsurprisingly, concluded that no further investigation of its client was necessary. To complete the bureaucratic laundering process, Flynn says, the SEC dropped the case and destroyed the files.
This is the agency that’s supposed to keep Wall Street honest. No wonder it isn’t working.
The SEC’s inspector general is investigating the destroyed MUIs and plans to issue a report. NARA is also seeking answers. “We’ve asked the SEC to look into the matter and we’re awaiting their response,” says Laurence Brewer, a records officer for NARA. For its part, the SEC is trying to explain away the illegality of its actions through a semantic trick. John Nester, the agency’s spokesman, acknowledges that “documents related to MUIs” have been destroyed. “I don’t have any reason to believe that it hasn’t always been the policy,” he says. But Nester suggests that such documents do not “meet the federal definition of a record,” and therefore don’t have to be preserved under federal law.
In history books we learn of the greedy capitalists manipulating markets and causing disasters. The capitalists are long gone. Replaced by the business socialists that use the government as a tool for riches and public funds for their support.
Does anyone still believe that the SEC or any government agency serves the interests of the people?
Harry Markopolos is telling of yet another racket. How many more out there? Will he get the same government attention he did with Mr. Madoff’s affair?
I just talked to someone that told me he had no money for gold or silver. He’s worried that all the government/financial corruption will lead to economic collapse as it has throughout history. He’s getting rolls of nickels from the bank and saving them each payday. He tells me that a nickel is worth seven cents in the metal it is made from. When the economy collapses he’ll have some coin worth something. (If it doesn’t collapse he’ll just have a lot of nickels to lug to a bank.) American Ingenuity?
People are seeing through the government and it isn’t pretty. People are scared.
“Repetition does not transform a lie into a truth.” –Franklin D. Roosevelt,