Sen. Charles E. Grassley of Iowa, the ranking Republican on the Senate Finance Committee, has written to the SEC to express concerns about whether it has properly investigated warnings about possible insider trading at Lehman Brothers. The Washington Post reports that since April 2008, a senior Lehman analyst has provided more than 4,000 e-mails and other documents to the SEC, and also met with the SEC in person.
Grassley’s letter notes that his concerns are partially the result of the SEC’s performance in the Madoff case: “In light of the SEC’s failure to follow-up on repeated warnings about the Madoff ponzi scheme,” Grassley wrote, “I must inquire as to whether these allegations are being acted upon.”
The Post reports that the Lehman Brothers whistleblower has provided evidence to the SEC about possible insider trading by traders in a Lehman unit called the Product Management Group. Stock analysts at Lehman reportedly sent their reports to this unit several hours before they were made public.