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Can Whistleblowers ‘Cross-Examine’ the SEC?

Posted by Larry Doyle on January 9, 2012 7:09 AM |

Later this month, Northwestern Law will be hosting its 39th Annual Securities Regulation Institute in Coronado, California. In light of everything that has occurred on Wall Street and in Washington, one might think this could be a lively conference as it looks to provide:

A timely analysis of recent laws and developments in the corporate and securities law fields presented by senior SEC officials and leading practitioners.

While reviewing the conference invitation, I am particularly intrigued by one workshop to be held on Friday morning, January 20th. What is this workshop? Who is involved? Why am I so intrigued? Please stick with me here as we preemptively try to connect some dots.

The specific session which intrigues me is as follows:

8:00–9:00 a.m.
SEC Senior Staff Workshop

Division of Enforcement Robert S. Khuzami, Director
Moderated by Richard H. Walker, Managing Director and General Counsel, Deutsche Bank AG, New York City

9:00–10:30 a.m.Enforcement and Criminal Investigations
• Enforcement risks for lawyers
• Whistleblowers and their impact on compliance programs
• The SEC’s new enforcement tools: How are they working?
• Enforcement highlights and trends

Session Chair: Mary Jo White, Debevoise & Plimpton LLP, New York City
Stephen M. Cutler, Executive Vice President and General Counsel, JPMorgan Chase & Co.,
Robert S. Khuzami
Richard H. Walker

I am especially interested in this session given the widely publicized and high profile SEC follies over the last decade in conjunction with the limited scope of cases emanating from our current crisis.

Do I need to remind anybody of the following names and situations—Madoff, Stanford, Art Samberg and Pequot, SEC attorney Darcy Flynn’s internal whistle-blowing, and more—which have not reflected well on our nation’s primary securities regulator?

However, while intrigued by this session I am also concerned that this gathering may not include a sufficiently comprehensive list of participants to aggressively explore all aspects of financial whistle-blowing circa 2012. Why so?

All of the participants are insiders.

Why is that such a concern? Well, let’s navigate back to mid-February 2011 when I wrote, Matt Taibbi Exposes Wall Street’s Regulatory Capture, in which the writer reported on another financial regulatory conference. I wrote and highlighted:

Is Wall Street’s regulatory capture a thing of the past? Not so fast.

The most troubling part of Taibbi’s article highlights a recent financial law enforcement conference at which senior representatives of the SEC and DOJ (Department of Justice) were present. Let’s review. I strongly encourage you to read this through, as there is a bombshell in the midst of it.

Throughout the entire crisis, in fact, the government has taken exactly one serious swing of the bat against executives from a major bank, charging two guys from Bear Stearns with criminal fraud over a pair of toxic subprime hedge funds that blew up in 2007, destroying the company and robbing investors of $1.6 billion.

Jurors had an e-mail between the defendants admitting that “there is simply no way for us to make money — ever” just three days before assuring investors that “there’s no basis for thinking this is one big disaster.” Yet the case still somehow ended in acquittal — and the Justice Department hasn’t taken any of the big banks to court since.

All of which raises an obvious question: Why the hell not?

Gary Aguirre, the SEC investigator who lost his job when he drew the ire of Morgan Stanley, thinks he knows the answer.

Last year, Aguirre noticed that a conference on financial law enforcement was scheduled to be held at the Hilton in New York on November 12th. The list of attendees included 1,500 or so of the country’s leading lawyers who represent Wall Street, as well as some of the government’s top cops from both the SEC and the Justice Department.

Criminal justice, as it pertains to the Goldmans and Morgan Stanleys of the world, is not adversarial combat, with cops and crooks duking it out in interrogation rooms and courthouses. Instead, it’s a cocktail party between friends and colleagues who from month to month and year to year are constantly switching sides and trading hats.

At the Hilton conference, regulators and banker-lawyers rubbed elbows during a series of speeches and panel discussions, away from the rabble. “They were chummier in that environment,” says Aguirre, who plunked down $2,200 to attend the conference.

Fit — and happy. The banter between the speakers at the New York conference says everything you need to know about the level of chumminess and mutual admiration that exists between these supposed adversaries of the justice system. At one point in the conference, Mary Jo White introduced Preet Bharara, her old pal from the U.S. attorney’s office.

“I want to first say how pleased I am to be here,” Bharara responded. Then, addressing White, he added, “You’ve spawned all of us. It’s almost 11 years ago to the day that Mary Jo White called me and asked me if I would become an assistant U.S. attorney. So thank you, Dr. Frankenstein.”

Next, addressing the crowd of high-priced lawyers from Wall Street, Bharara made an interesting joke. “I also want to take a moment to applaud the entire staff of the SEC for the really amazing things they have done over the past year,” he said. “They’ve done a real service to the country, to the financial community, and not to mention a lot of your law practices.”

Haw! The line drew snickers from the conference of millionaire lawyers. But the real fireworks came when Khuzami, the SEC’s director of enforcement, talked about a new “cooperation initiative” the agency had recently unveiled, in which executives are being offered incentives to report fraud they have witnessed or committed.

From now on, Khuzami said, when corporate lawyers like the ones he was addressing want to know if their Wall Street clients are going to be charged by the Justice Department before deciding whether to come forward, all they have to do is ask the SEC. (LD’s highlight)

Are you kidding me? How the hell does that work? The SEC will effectively tip off a potential defendant?

“We are going to try to get those individuals answers,” Khuzami announced, as to “whether or not there is criminal interest in the case — so that defense counsel can have as much information as possible in deciding whether or not to choose to sign up their client.”

Aguirre, listening in the crowd, couldn’t believe Khuzami’s brazenness. The SEC’s enforcement director was saying, in essence, that firms like Goldman Sachs and AIG and Lehman Brothers will henceforth be able to get the SEC to act as a middleman between them and the Justice Department, negotiating fines as a way out of jail time.

Khuzami was basically outlining a four-step system for banks and their executives to buy their way out of prison. “First, the SEC and Wall Street player make an agreement on a fine that the player will pay to the SEC,” Aguirre says. “Then the Justice Department commits itself to pass, so that the player knows he’s ‘safe.’ Third, the player pays the SEC — and fourth, the player gets a pass from the Justice Department.”

When I ask a former federal prosecutor about the propriety of a sitting SEC director of enforcement talking out loud about helping corporate defendants “get answers” regarding the status of their criminal cases, he initially doesn’t believe it. Then I send him a transcript of the comment. “I am very, very surprised by Khuzami’s statement, which does seem to me to be contrary to past practice — and not a good thing,” the former prosecutor says.

Earlier this month, when Sen. Chuck Grassley found out about Khuzami’s comments, he sent the SEC a letter noting that the agency’s own enforcement manual not only prohibits such “answer getting,” it even bars the SEC from giving defendants the Justice Department’s phone number. “Should counsel or the individual ask which criminal authorities they should contact,” the manual reads, “staff should decline to answer, unless authorized by the relevant criminal authorities.”

How fascinating. So, little more than a year ago our SEC Director of Enforcement Robert Khuzami offers insights on how the SEC plans on engaging the counsel of prospective defendants. Do you think that such a process of engagement will engender a system promoting meaningful transparency and real integrity? Strikes me that Khuzami et al are offering a Get Out of Jail Cheap card. How does that work?

If, in fact, this practice is being implemented by the SEC, how does that impact whistleblowers? If you are a whistleblower, would you think the SEC would be fully committed to protecting you in light of Khuzami’s statement?

Will Khuzami and others on this panel address this topic at the San Diego conference? I think it should be the FIRST question to be addressed. Why wouldn’t there be anybody on the panel to effectively cross-examine Khuzami and the other regulators on this point and others like it?

Are there any whistle-blowers or other individuals in our audience who might like to put forth this question or others while raising issues and topics which Sense on Cents welcomes promoting? Please comment on this post.

Questions, comments, constructive criticisms always encouraged and appreciated.

Larry Doyle

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I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets, our economy, and our political realm so that meaningful investor confidence and investor protection can be achieved.





  • Peter S.

    For the former SEC Enforcement Director Stephen M. Cutler to be sitting on any panel discussing the integrity of securities regulations is unfathomable. During Cutler’s rein as the SEC Enforcement Director from 2000- 2006, the most disturbing behaviors in our financial markets occurred under his watch as our nation’s financial industry “top cop” while he postured for his potential future employers.

    The Enron and Worldcom disasters were dumped on his doorstep by whistle-blowers in such a way that he could not ignore them – the DOJ getting involved has a way of keeping “your mind right.”

    Then came the mutual fund industry market – timing scandal that ended up having dozens of mutual fund firms, investment banks, and insurance companies fraudulently allowing preferred investors to pillage the profits and principle of millions of traditional long-term mom, pop, children, and baby investors. The market-timing fraud in mutual funds became a fire storm in the industry in 2003, 2004, and 2005.

    Many in Congress were once again calling for accountability in the mutual fund industry and in the SEC. But we all know how that turned out. Senator Shelby blocked all reforms and virtually no meaningful events were triggered to protect mom and pop. Many mutual fund shareholders are still getting restitution checks to this day – but let me suggest that it’s pennies on the dollar. Just ask Harvard’s Professor Peter Tufano. Well that may be difficult because the professor for decades at Harvard University has recently sought asylum at the University of Oxford in England.

    The mutual fund industry market-timing scandal’s fraud was that fund companies management, and their “independent” fund boards, KNEW and ENCOURAGED the securities fraud by preferred and influential investors even though the funds’ prospectuses strictly prohibited the transactions – the prohibited transaction were so detrimental to the traditional mutual fund investor that if the fund decided you were not worthy enough (wealthy, influential) they could terminate all your transaction privileges in the fund.

    This activity was extraordinarily blatant – and so amazingly easy to detect – even by outside experts with no ties to the company, simply by using public data from TrimTabs (fund inflows and outflows which after the scandal the SEC prohibited from being made public ) to determine if the fund company invited those with money and privilege to the pillaging.

    The SEC knew of the activity as far back as the early 80s, and the activity was increasing yearly along with the damage to those shareholder’s invested in the funds being looted. In 2001 alone, the damage was estimated by a number of expert economist from the countries best colleges and universities, amounted to 1%-2% of the unwitting’s principle and profit being looted in their retirement savings yearly!

    That amount in most case was equal to, or greater than, the already deemed excessive management fees. Funny how that most of the fund companies involved already were charging the highest fees in the industry. Ask your trusted financial planner how an extra (above and beyond all fees and in addition negative market conditions) 1% – 2% of your IRA, 401k, 529 Plan principle being ripped off every year will affect your families’ financial future. There is more, but in a nut shell…..

    What experience do I have with Stephen M. Cutler, who I believe to be merely an elitist sociopath? First let me say that much of what I can’t say I have brought to the attention of authorities in a four year odyssey of my second whistle blowing, which I can’t confirm is being investigated by those in government that should be deeply concerned, has nailed Mr. Cutler.

    If you don’t mind LD, I will continue my post later in the afternoon.

  • JB

    On December 12, 2011, Labaton Sucharow announced the results of its nationwide Ethics and Action Survey and I thought you might find the results of interest.

    The survey was conducted by ORC International and questioned Americans about their knowledge of wrongdoing in the workplace and willingness to report it.

    The survey results showed a disturbingly high percentage of people were aware of wrongdoing in the workplace and a high percentage of those people were willing to report wrongdoing.

    However, surprisingly, the results showed only a small percentage of Americans were aware of the incentives and protections associated with the SEC Whistleblower Program enacted under the Dodd-Frank Act.

    You can find the full results of the survey on our website at

    An excellent resource regarding our survey, the SEC Whistleblower Program, and securities enforcement matters generally is Jordan A. Thomas.

    Jordan joined our firm as the Chair of our Whistleblower Representation Practice, in July straight from the Securities & Exchange Commission. At the SEC, Jordan played a leadership role in the development of the SEC Whistleblower Program, including drafting the proposed legislation and implementing rules and briefing members of Congress.

    He also served as the principal architect and first National Coordinator of the SEC’s Cooperation Program, an initiative designed to facilitate and incentivize individuals and companies to self-report securities violations and participate in investigations and related enforcement actions.

    Over the years, he has been nationally recognized for his work on many of the Commission’s highest-profile matters such as those involving Enron, Fannie Mae, UBS, and Citigroup.

    To date, he is the only lawyer in the private sector who actually worked at the SEC in a senior and direct role in the development of the whistleblower guidelines from their genesis to enactment.

    • Peter S.

      Having just spoken to Mr. Jordan Thomas I was no more convinced that things have changed. I asked him whether or not he was in the SEC Enforcement Division, he was. I asked him what he thought of all the careers Stephen M.Cutler saved and/or ruined – Mack career saved, dutiful SEC investigator Gary Aquirre ruined, JP Morgan whistleblower Peter Sivere ratted out to JPMorgan by Cutler’s Enforcement Division, another career ruined. My whistle-blowing which Cutler suggested was one of thousand tips a day – that would mean everyday three thousand SEC investigators would be sitting across the table from a would be whistleblower with rock solid evidence of massive securities fraud.

      When it was publically found out after state securities regulators dutifully responded to the evidence I brought to them and it became know that months earlier I had met with the BDO of the SEC with the same evidence, Cutler then squirms under mounting critism and tells the world that one of those three thousand whistle-blowers a day actually called him on September 8th, 2003(the financial informant must have gotten his phone number from the yellow pages) to report the same whistle-blowing I reported to the SEC BDO beginning six months earlier. I asked him what he thought of Cutler calling up his former deputy Linda Thomsen as he JPMorgan general Counsel attempting to get non public, inside information about the regulatory state of Bear Sterns so his firm could make a bid that would save JP Morgan billions. I have no opinion of Mr. Jordan , other than he certainly would not want to burn any bridges.

      If there is a rotten apple in the middle of the bushel and none of the fruit closes to it fails to expose its existence, than eventually the rot and stench permeate throughout despite the outer fruit certainly being far less duplicitous than the apples in direct contact. Some smelled rotten in Denamrk and I found out what is was! Sometimes you gotta take a stand!

  • LD


    Thanks for your message here.

    I found your attached survey to be of real interest. As our nation begins down this new path with Dodd-Frank, how can we know that companies will in fact embrace the whistleblower program within D-F? What penalties are there for not embracing it? I found in your survey language that states,

    “In strengthening protections and incentives for whistleblowers, the federal government recognized that law enforcement authorities cannot effectively and efficiently police the marketplace without the assistance of private individuals and entities,” continued Thomas.

    “Accordingly, now, more corporations will establish a culture of integrity in their organizations and individuals will courageously report wrongdoing wherever they find it.”

    How do we know that more corporations will establish a culture of integrity? Based upon what? Hope? If hope is a business plan, I think we will be waiting a LONG time for this integrity. What are the penalties and assurances of protection for the whistleblowers?

    I do not believe that we can merely rely upon hope. Given the experiences of whistleblowers to date, how can we know and insure that whistleblowers will be protected.

    I do agree that the launch of Jordan’s practice is certainly very timely.

    • Peter S.

      I have heard it all before in 2003, and 2004. Despite being a nationally recognized whistle-blower who played a pivotal role in uncovering a massive fraud that looted American mutual fund investors of billions of dollar a year for years – I see no change, hear no change, or feel no change. As LD has pointed out before, the more thing change the more they stay the same – just your typical three card Monte. On the boardwalk one day you find the shill and the mark betting against dealer, and the next day, on another corner, the shill is now the dealer, and the dealer is now the shill – and the mark stays the same, mom and pop.

  • Peter S.

    In March of 2003 I contacted an attorney from Boston’s preeminent securities law firm. I had written a timeline of events that stunned the attorney so that I was introduced to the founding partner of the firm. Both suggested I was in a world of trouble and that this matter may make me eligible to enter a witness protection program. I balked. I told them this was a fraud that needed to be enforced by the Securities and Exchange Commission – that this fraud more than likely was occurring throughout the industry if it was occurring at the firm I worked which was at the time the fifth largest mutual fund firm in the world (at the time, and like all Americans, I had no idea the Securities and Exchange Commission was fraught with regulatory capture, conflicts of interest, and porn surfing SEC investigators).

    The attorney said that a neighbor of the attorney in the tony town of Brookline MA worked in the Boston District Office of the SEC. The attorney contacted her to discuss how best to approach the SEC. The attorney had numerous communications with the BDO of the SEC. The attorney told me that they would first like to meet with my attorney alone (let me suggest that was/is a recipe for a scandal).

    April 14th

    The attorney meets with the assistant BDO for a one hour meeting. The attorney was given my permission to share all the conclusive evidence I possessed with the SEC, including internal documents, my spread sheets with over $850,000,000 of fraudulent transaction with names and account numbers of the market-timers, internal emails, and the prospectuses of the funds being harmed.

    April 15

    The Assistant BDO schedules a meeting for my attorney and me with the District Administrator of the BDO of the SEC, Juan Marcelino and others, for April 24.

    April 22nd

    Another SEC attorney, Phil Koski, cancelled our meeting for April 24, at the same time asking my attorney to thank me in advance for coming forward with the evidence and reschedules the meeting with the BDO Administrator Juan Marcelino and others for Monday, April 28th. More emails between my attorney and the SEC.

    April 28th

    I meet with SEC attorneys David Bergers, Phil Koski, and Suzanne (investigator, last name unknown). I am told that Juan Marcelino, the District Administrator of the Boston District Office of the SEC would now not be able to make the meeting, but all three SEC officials nod with the utmost concern – and in agreement that Marcelino would be completely informed. I ask them for identification and one man hands me his card with the name David P. Bergers. I assume that is his identity. The other says he does not have a card on him and takes Berger’s card and writes his name and extension on the back. Phil Koski was his name -I still have the card. (I now believe that was not David Bergers who produced the card bearing the his name after having viewed a picture of the real David Bergers, now the SEC District Administrator of the BDO, in the Boston Herald this past summer). The other, an SEC investigator named Suzanne, and who I believe was a Brookline MA neighbor of my attorney, does not respond to my request. We meet for one hour. It is contentious. I discuss all documents I possessed and my deep concern that #$@%^& Management was fully aware of the harm being done to shareholders since at least January of 2000. I tell them I documented on a spread sheet almost a billion dollars in market timing transaction by a group of ten 401k clients in #@%$&^ International &%$#@&^ Fund. I tell them that many more funds and hundreds of market-timers were active at %$#@&#, both in the 401k division and also in the IRA retail area (though the latter was outside of my area, I had received a call from a client that had just made a large market-timing transaction in her 401k account and wanted me to check her husband’s IRA. She stated that she had performed that transaction over the automated system at her husband’s direction and wanted to verify that it went through. I told her I could not access the account, later in discoveries of a class action filing, one IRA account market-timer was found to have made over $14,000,000 market-timing just one fund – no need for diversification there). Eventually Koski produces the prospectus of #@%^&$ International &^%$#@# Fund, I had given it to my attorney weeks earlier for her meeting with the SEC at the BDO, and Koski asks me to show him what the problem. I think what an asshole this bastard is – he canceled my meeting with him a week ago to review the materials and now pretends he doesn’t understand my concerns. I take the prospectus and read out loud the language that should bring an immediate enforcement investigation.

    “The exchange privilege is not intended as a vehicle for short term trading. Excessive exchange activity may interfere with portfolio management and have an adverse effect on all shareholders. In order to limit excessive exchange activity and otherwise to promote the best interest of the fund, the fund reserves the right to revise and terminate the exchange privilege. The SEC requires that, before you purchase a mutual fund, you must first read the prospectus.”

    I inform them that not only is &%$#@# Management aware of the massive amount of market-timing occurring in International #@%^&$#, as well as other international funds; so is the “Independent Fund Board.” I read from two power point documents I had found and dated March 2000, and ordered “For Internal Use Only.” The two documents are titled “Market Timing-FAQ” and “Short-Term Trading Fees (STTFs) – FAQ.” The Market Timing FAQ document stated that:

    “Excessive trading in number &%$#$@ funds have had a detrimental effect on the long-term shareholders of the funds. The cash flow volatility in the funds is so high that $%#^&# Management believed that immediate action was required. In order to rectify this problem, &^%$#@ identified and reviewed the exchange history of these accounts. Each fund’s prospectus allows for Putnam to terminate the exchange privilege if Putnam management believes it is in the best interest of its shareholders.”
    I tell the three SEC personnel that according to the Short-Term Trading Fee (STTFs) – FAQ document that &^%$#@’# “Independent” Fund Board allowed for Short Term Trading Fees on all round trip trades occurring in a 90 day period. I go on to tell them that the board voted to have SSTFs NOT apply to &^%$#@ managed Defined Contribution 401k and IRA participant accounts, omnibus, or &^%$#@ and &^%$#@ variable annuity products.”

    I express my deep concern that “Independent” &^%$#@ Fund Board Chairman for Life, John %&$#, virtually created a PROMOTIONAL document for all would be market timers; if you want to market-time mutual funds than you need to be under &^%$## Management’s and $%^#@ Fund Board umbrella.
    I tell those SEC employees present that the fraud I am concerned with is that both &^%$#@ Investment Management and the Independent &^%$#@ “Independent Fund Board had been aware of the behavior for years (internal documents confirmed and which the SEC OIG has been given) and had done nothing stop the fraudulently allowed transactions. I tell them I believed it is the Independent Fund Boards moral, ethical, and fiduciary duty to notify all shareholders that the prospectus clearly prohibits the short term trades and that &^%$#@ Management and the “Independent Fund Board “was encouraging the fraud to continue so to increase fees, and more importantly and far more lucratively for all being compensated beyond the vast majority of all mutual fund shareholders dreams, was increased asset under management. Assets under management are the most important variable used to compensate both management and the board – NOT PERFORMANCE! I tell all present I believed &^%$#@ Investments was marketing the inside knowledge that &^%$#@ Investments would do nothing to prohibit market-timing. &^%$#@ was gaining considerable Taft Hartley Plans (multi-employer union retirement plans). These were highly lucrative plans with hundreds of millions of dollars in assets and the members of many of the plans actively engaged in market-timing.

    No response was forth coming. I am stunned. I now know they are just sizing me up. I told them I want to remain confidential. I tell them I believe my being viciously assaulted on February 2, 2003, two days after leaving the firm with all the evidence I would need to bring dutiful regulators to investigate the securities fraud was the directly related to the assault. I tell them I had been ostracized in my department the last two weeks of my active employment (I was moved outside of the Preferred Services Specialist area to a remote cubicle despite consistently being one of the PSS unit’s top performers). They know I was scared. Not one of the three ever suggests I contact the U.S. Attorney’s Office regarding my assault. They half-heartedly thank me for my courage and I leave believing I am in more danger now than before.

    Month past, my attorney had a few conversations with the SEC BDO, but they went nowhere. My attorney told me I now be dealing with the second name in the attorney’s firm name and obvious senior partner. Unrevealed to me, the senior partner, and primer white collar securities fraud defense attorney was representing broker from Prudential that had been altering transaction dates on mutual fund trades (winning horse after the race was complete) before the very SEC that I now had much mistrust . At my first meeting with him, I walked through his office door and he stated as I sat, “So you want to be a rat.” I looked at him incredulously, paused, and said with utter contempt, “What the hell do you mean by that – I am a whisle-blower not a rat, this firm is ripping off my neighbors – I have no loyalty to this firm, and am a licensed broker. I am required by law to report this fraud, it ain’t chump change – its millions, and if every other mutual fund firms is allowing it than it is billions being skimmed from my neighbors. My wife for God’s sake is invested in one of these funds!” He backed off, and gave some options of which none would he be representing in. I told him I would get back to him.

    September 8th is the day I got back the shyster. This is the day my life got even worse than it was already. This is the date Cutler got involved in a most nefarious way. This is the date, and Cutler historical denial and deception of what occurred on this day, is the event that would have America’s 100,000,000 mutual fund investors, and most in Congress, demanding for his prosecution.

    LD, got to continue later.

  • Nora

    Very interesting, anyone knows if this conference is open to the public?

    • LD


      I believe it open to the public but with a fairly steep price tag. As the brochure states,

      Registration and Tuition
      Regular tuition for the Securities Regulation
      Institute is $1500 per person. Early bird discounted
      price is $1350 per person through December 1.

      Tuition includes all sessions, continental breakfasts,
      lunches, coffee breaks, receptions and extensive
      program materials distributed at the Institute.
      Tuition also covers complimentary access to
      all sessions on-demand via our online partner,
      West Legal Edcenter, post-program.

      Registrations must be made in advance. On-site registration is only available as space permits and requires an additional $100 fee.

      Registration is for the full three days of the program

      • Nora

        Hi Larry,

        thank you for the response and a happy new year to you, and yes it is a bit too much price, I thought it would be interesting to partake since it’s so close to home for me on so many levels.

        • LD


          A Happy New Year to you as well.

          2012 should be very interesting on many fronts. I hope and pray that it is a very good year for you and yours.

  • Mark J. Novitsky

    Being an SEC / National Security Whistleblower that was attacked (See something say something…Right?) The fact that the SEC recently was caught illegally destroying in excess of 10,000 case files / documents / evidence MUI’s (Matters Under Inquiry / Investigation) that should have been archived for 25 years…saying OOOPS…my bad…won’t happen again…until it does. CLEARLY with the heads of the SEC being investigated for past misconduct (Schapiro, Khuz, now ex-Becker) but having immunity / “Liability Provisions” …The Obama DOJ investigating, indicting, prosecuting fewer financial felons than Reagan, Clinton, & both Bush’s despite a massive Target-Rich environment (Madoff to MF Global) – What has changed??? The SEC…STILL the Selective Enforcement Commission.

  • Peter Sivere

    Linda Chatman Thomsen of Davis Polk & Wardwell will co chair the session on Ethical Considerations in an Era of Whistleblowers and Increased Government Investigations.

  • Mark J. Novitsky

    The construct of this annual PR stunt has got to be an insider joke at the expense of the 99%. I first blew the whistle to Congress regarding my documented experience dealing with the SEC / CEO “Hotline” to stop or stall SEC investigations in 2007. It was later confirmed by Ma. Congressman Stephen Lynch during the 2009 House Finance “investigation” of SEC “failures” associated to the Madoff “fraud”. Express Testimony – Mr. Lynch: “The other thing that I keep hearing from some current SEC – and former — is that, well, there is a whistle — let me rephrase that. There is a hotline. I was told that senior SEC management had actually gone to an industry — a financial services industry conference and basically said to the firms out there, if you feel that you are being too aggressively investigated, then I want you to call this office. And that was a senior person, two senior people at the SEC. I know these employees took that message as meaning, you know, we have to back off a little bit, in that the senior management at the SEC was actually captured by the industry and that it wasn’t doing the intense investigating that we would expect from them…It just struck me, there was a hotline to stop an investigation or to slow it down at the SEC, but there wasn’t one to speed it up or initiate it. It just seemed counterintuitive to me, given the mission of the agency itself.” – I tried giving that documented evidence and that quote to my congressman Keith Ellison who is also on the House Finance Committee, whom I warned about this years earlier and whose only action has been to protect the SEC corruption and my former employer / govt. contractor Tele-Tech Holdings (TTEC), and pretty much the entire major MSM…you know…given the 2008 “crisis”. AND nobody but ran with it. Only the people can stand against such injustice when the politicians / regulators / media are patently bought off lock, stock and barrel to protect the 1%. So what Khuzami “joked” about the CEO/SEC “Hotline” to stop or stall investigations isn’t new. Matt Taibbi should write “Is the Congress / DOJ Protecting the SEC Protecting Wall Street Crimes” (rhetorical) — Peter…perhaps we should exchange war stories. (fpvsff)

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