Bloomberg Business Week reported the SEC authorized an independent investigation in the wake of a top official's resignation in the Office of the Inspector General.
John Nester, an SEC official, said in an email that an individual disclosed accusations of wrongdoing by SEC employees. The Council of Inspectors General on Integrity and Efficiency is aware of the situation but the SEC has not revealed who is the independent investigator. The statement did not address the accusations or the names of the employees involved.
Bloomberg’s Steven Sloan said this investigation is occurring during a search for a permanent inspector general. Noelle Maloney, deputy inspector general, is serving as an interim inspector general while the SEC searches for a replacement. The inspector, David Kotz, resigned earlier this year in January.
Kotz investigated the SEC’s mishandling of overseeing financial firms leading up to and during the economic recession but employees objected to his investigations due to the lack of proof.
He recommended to federal prosecutors that the former SEC general counsel David Becker be charged with criminal ethics violations, in connection with his policy and Bernard Madoff’s ponzi scheme. Becker inherited income from his parents’ account connected with Madoff but was acquitted of charges by the Justice Department.