WASHINGTON — As early as 1997, officials at the Securities and Exchange Commission suspected that Robert Allen Stanford was running a Ponzi scheme. But they did not take significant steps to investigate until 2005, and it was not until 2009 that the agency charged Stanford with perpetrating an $8 billion fraud.
So concluded the SEC’s inspector general in a report last year.
Now, in a follow-up study, inspector general H. David Kotz concludes that some of the same influences that contributed to the Stanford embarrassment still may be compromising the SEC’s handling of tips. Loosely translated, SEC officials may be so concerned about their batting averages that they refrain from recording their suspicions in an SEC database of tips, complaints and matters referred to the SEC’s enforcement division for possible follow-up, Kotz said in a report released Thursday.
