SEC Inspector General: Staff only pursued ‘slam-dunk’ cases

In testimony before Congress, the Securities and Exchange Commission’s Inspector General, H. David Kotz. said the culture at the agency encouraged its enforcement division to go after the easy cases, because the staff felt like they were judged on the numbers they won. “…cases like Stanford, which were not considered “quick-hit’ or “slam-dunk’ cases, were not encouraged,” Kotz said, according to Investment News. He told Congress that the SEC needs to improve coordination between the inspection and enforcement divisions and change the mindset from one primarily concerned about litigation risks to one concerned with investor safety.

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