BusinessBusiness RecoveryAuditors to be enlisted by SEC for compliance work

Auditors to be enlisted by SEC for compliance work

Auditors and retired FBI agents to pick up the slack at the SEC

The Securities and Exchange Commission is planning to enlist the help of
auditors and former Federal Bureau of Investigation agents to help it tackle
fraud investigations.

SEC chairwoman, Mary Schapiro who took over two months ago, is said to be
considering plans to ‘leverage’ third parties such as auditors and retired FBI
agents in the hopes of tackling the issue of limited resources at the
Commission, the
Financial
Times
reports.

‘We need to find some ways to increase staffing, but beyond that [to]
leverage third parties without abdicating our responsibility’ said Schapiro

She added: ‘This can be done not [only by] self-regulatory organisations,
though that is one possible mechanism, but [also by] other third parties such as
auditors or others who can do compliance reviews.’

The regulator has come under increased pressure following the Bernard Madoff
‘Ponzi’ scandal where the SEC regularly examined the brokerage operation but
never inspected the investment advisory business which was at the heart of the
fraud.

Enforcement staff at the regulator has fallen by 10% with 400 SEC staff
examining more than 11,000 investment advisers.

Further reading:

SEC
plans to enlist private scrutineers

Madoff auditor charged

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