Two attorneys at the SEC are reportedly under “active” criminal investigation by the FBI for insider trading. CBS News reports that the accusations against the two lawyers, whose names have not yet been released, are detailed in a report by the SEC inspector general that is based on “more than two years of e-mail and brokerage records.”
According to the report, the male attorney under investigation by the FBI works in the Office of the SEC’s Chief Counsel and “has access to a tremendous amount of nonpublic information.” The female attorney at issue works in the enforcement division, and is said to have “traded in the stock of a large financial services company” despite being told by another SEC employee of ongoing “investigations of that company” — a direct violation of SEC rules. In addition, CBS News reports, the male attorney was found to have sent e-mails from his SEC account to his brother and sister-in-law “recommending particular stocks.”
The SEC told CBS News:
We take seriously even the suggestion that any SEC employee would engage in insider trading. We note that the IG’s report neither accuses any SEC employee of insider trading nor concludes that any such conduct took place.
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Why does the SEC employ only lawyers, who are not known for their mathematical prowness or their financial background? This institution is not doing its job because nobody is qualified.