SEC faces broad review by government auditors
The Securities and Exchange Commission, criticized by Congress for its handling of a trading probe that entangled Morgan Stanley Chief Executive John Mack, faces a broad review by government auditors of its management and methods for policing the financial markets.
The Government Accountability Office agreed last week to investigate the SEC’s enforcement division and compliance department after requests by Sen. Charles E. Grassley (R-Iowa), who questioned whether the agency gave Mack special treatment.
Grassley asked the GAO to examine the SEC’s “planning, oversight, control and other management processes” and gauge whether the agency does enough to oversee regulators at the New York Stock Exchange and NASD (formerly the National Assn. of Securities Dealers).
“Based upon allegations I have received over the past few months, I have become increasingly concerned regarding the operations of the SEC,” he wrote the GAO in seeking the inquiry.
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