SEC may have destroyed documents, senator says

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Source: MarketWatch

The Securities and Exchange Commission may have destroyed documents and compromised enforcement cases involving activity at large banks and hedge funds during the height of the financial crisis, according to allegations made by a lawmaker on Wednesday.

“From what I’ve seen, it looks as if the SEC might have sanctioned some level of case-related document destruction,” said Sen. Chuck Grassley, Republican of Iowa, in a letter to the agency’s chairman, Mary Schapiro.

“It doesn’t make sense that an agency responsible for investigations would want to get rid of potential evidence. If these charges are true, the agency needs to explain why it destroyed documents, how many documents it destroyed over what timeframe, and to what extent its actions were consistent with the law.”

Grassley, the top Republican on the Senate Judiciary Committee, said he recently received a letter arguing that the agency staff “destroyed over 9,000 files” related to preliminary agency investigations.

Read more: http://www.marketwatch.com/story/sec-may-have-destroyed-documents-senator-says-2011-08-17?dist=afterbell

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SEC Destroys Evidence Against Banks And Hedge Funds, Whistleblower Alleges
http://www.forbes.com/sites/halahtouryalai/2011/08/17/sec-destroys-evidence-against-banks-and-hedge-funds-whistleblower-alleges/

(snip)
The allegations stem from SEC attorney Darcy Flynn who handled the agency’s records. Flynn, a 13-year veteran of the agency, says the SEC has been destroying records related to SEC investigations including Madoff’s since at least 1993.



Taibbi: Is the SEC Covering Up Wall Street Crimes?
http://www.rollingstone.com/politics/news/is-the-sec-covering-up-wall-street-crimes-20110817