Friends in high places - the controversies dogging the SEC
"If the SEC gave JP Morgan a pass because it was doing the Government a favour by taking over Bear Stearns in a crisis, then it should come out and say so. Otherwise, it is hard to understand why the SEC never brought this case..."
April 19, 2012 at 07:03 PM
7 minute read
Claims that the SEC gives special treatment to connected individuals continue to dog the US markets regulator. Susan Beck reports
Call it reverse accountability. In the wake of the financial crisis, the US Securities and Exchange Commission (SEC) has often been criticised for failing to charge any top executives when it sues a big institution. But one case stands out as an exception. In February, the SEC announced it would settle fraud charges against Ralph Cioffi (pictured left) and Matthew Tannin (pictured right), the former Bear Stearns hedge fund managers who oversaw a 2008 implosion of their funds that led to $1.6bn (£1bn) in investor losses.
In a deal that was announced on the day their civil trial was set to begin, the two men agreed to pay a total of $1.05m (£660,000). But their employer – Bear Stearns Asset Management, now owned by JP Morgan Chase – was never charged.
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