SEC Blasted For Blowing Another $8 Billion Fraud


From the FT:

“Once again regulators are playing catch-up,” said James Cox, professor of law at Duke University…

The SEC “stood down” on its investigation at the request of another federal agency in the spring of 2008 but resumed it in December 2008, Stephen Korotash, an associate regional director of enforcement at the SEC’s Fort Worth office, said on Wednesday . He declined to name the other agency.

The Financial Industry Regulatory Authority (Finra), the industry securities body that oversees broker-dealers, is also likely to come under growing scrutiny over its role…

Aaron Marcu, head of the US litigation practice at Freshfields Bruckhaus Deringer and a former federal prosecutor, said: “Regulators are not guarantors and it’s not realistic to expect them to ferret out every fraud being perpetrated in secret by every registered entity in a free market.”

But Venezuela-based financial analyst Alex Dalmady, who recently claimed the company was a fraud, said that it took him just 20 minutes to create the spreadsheet that formed the basis of his analysis.

(Everything’s obvious in hindsight?)

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