Big Businesses Offer Revolving Door Rewards

Major corporations make it financially advantageous for executives to take government jobs, according to regulatory filings reviewed by POGO. Through their compensation policies, companies may be fueling the revolving door.

Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture

A revolving door blurs the lines between one of the nation’s most important regulatory agencies and the interests it regulates. Former employees of the Securities and Exchange Commission (SEC) routinely help corporations try to influence SEC rulemaking, counter the agency’s investigations of suspected wrongdoing, soften the blow of SEC enforcement actions, block shareholder proposals, and win exemptions from federal law. POGO’s report examines many manifestations of the revolving door, analyzes how the revolving door can influence the SEC, and explores how to mitigate the most harmful effects.

Overview

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Overview

Much Ado About Nothing?

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Part 5 and 6

Wrinkles in the Ethics Rules

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Revolving Door Rules Apply Unevenly and Revolving in the Dark

Exploring Solutions

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Looking Outside the SEC, Conclusion, Recommendations

A Regulation Derailed

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Part 1: Money Market Meltdown - A Case Study

SEC Alumni Help Firms Get a Break

POGO Report - Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture, February 11, 2013, Scores of SEC Alumni Go to Bat for SEC-Regulated Companies

POGO Opposes Self-Regulation for Swaps and Futures Markets

We appreciate your oversight of the federal agencies that regulate the swaps and futures markets, especially in light of the massive customer losses at MF Global and Peregrine Financial Group. As you explore opportunities for improving the regulation of these markets, we urge you to reconsider the government’s reliance on private self-regulatory organizations (SROs) such as the National Futures Association (NFA).

POGO Opposes Self-Regulation of Investment Advisers

POGO has joined others in raising serious concerns about the Financial Industry Regulatory Authority (FINRA), the largest self-regulatory organization (SRO) for the securities industry. FINRA’s regulatory effectiveness is undermined by its inherent conflicts of interest, its lack of transparency and accountability, its lobbying expenditures, and its executive compensation packages, among other issues. A recent analysis by the Boston Consulting Group underscored the costs associated with authorizing FINRA or a new SRO to regulate investment advisers. For these reasons, we oppose H.R. 4624, which would authorize one or more SROs to oversee the investment adviser industry.

Public comment regarding ACUS recommendations on federal advisory committees

The Project On Government Oversight (POGO) would like to provide the following public comment to the Assembly of the Administrative Conference of the United States (ACUS) regarding the proposed recommendation dealing with the Federal Advisory Committee Act (FACA).

Revolving Regulators: SEC Faces Ethic Challenges with Revolving Door

POGO has obtained five years’ worth of statements filed by former Securities and Exchange Commission (SEC) employees who appeared before the SEC seeking to represent outside clients within two years after leaving government. POGO has also made these post-employment statements publicly available in a searchable online database. This report provides an overview of the information disclosed in these statements, and examines the SEC’s oversight of former employees who go through the revolving door.

POGO Letter to FINRA Calling for Open Board Meetings

As an independent watchdog that champions good government reforms, POGO has a keen interest in ensuring that our nation’s financial regulatory watchdogs—including self-regulatory organizations (SROs) such as FINRA, which currently oversees over 4,600 brokerage firms operating in the U.S.—are operating with sufficient transparency and accountability to their members, investors, and taxpayers.

FINRA's Enforcement Chief to Step Down

The Wall Street Journal reports this morning that Susan Merrill, head of enforcement at the Financial Industry Regulatory Authority (FINRA), will be stepping down from her post, following a period in which FINRA’s lax enforcement of its large member broker-dealers and its failure to catch the Madoff and Stanford Ponzi schemes have raised serious questions about the organization’s regulatory effectiveness.

POGO Letter to Congress Calling For Increased Oversight of Financial Self-Regulators

The Project On Government Oversight (POGO) is writing to raise concerns that Congress’s efforts to reform the financial regulatory system have not adequately addressed the failures of the private self-regulatory organizations (SROs) that are tasked with protecting the investing public and maintaining the integrity of our financial markets.

Former SEC Enforcer Joins Major Law Firm

Robert Khuzami, the former enforcement chief at the Securities and Exchange Commission, has accepted a job at a major corporate law firm that represents clients before the SEC, highlighting concerns raised by POGO and others about the revolving door between financial regulatory agencies and firms representing Wall Street.

Judge Throws Out SEC Resource Transparency Rule

A federal judge has thrown out a rule that required companies to disclose payments made to U.S. and foreign governments for the extraction of oil, natural gas, and minerals.

Retroactive Rights a Victory for Whistleblowers

Last week, the U.S. Merit Systems Protections Board expanded the application of the Whistleblower Protection Enhancement Act and granted anti-retaliation protection to whistleblowers whose cases were pending before the WPEA was passed in November 2012.

Corzine Faces Rare Charge in MF Global Case

The Commodity Futures Trading Commission (CFTC) took an action that regulators have rarely attempted since the 2008 financial crisis: trying to hold a CEO personally accountable for “failure to supervise.”

Taxpayers Could Foot Bill For Fannie Mae Fraud Settlement

Years after the government accused Fannie Mae of accounting fraud, are taxpayers being forced to pay the price?

SEC Taps Wall Street Lawyer to Police Wall Street

The Securities and Exchange Commission (SEC) announced Monday that it has tapped a Wall Street lawyer, Andrew Ceresney, to police Wall Street. By relying so heavily on people with industry connections, the SEC can tangle itself in conflicts of interest.

IRS Threatens to Weaken Whistleblower Program

The Internal Revenue Service (IRS) has proposed regulations that would “hamstring” its whistleblower program, according to Senator Charles Grassley (R-IA), a longtime champion of whistleblowers.

Prospective SEC Chairman Dismisses Revolving Door Concerns

Mary Jo White—Obama’s nominee for chairman of the Securities and Exchange Commission—said at her confirmation hearing that the public need not worry about her history of defending companies from the government. But her explanation was less than reassuring.

Why Congress Should Be Wary of Mary Jo White

Is Mary Jo White—President Obama’s nominee to head the Securities and Exchange Commission—an intrepid enforcer who will hold Wall Street accountable? Or will she look out for the financial industry she used to represent?

New York Panelists Debate Revolving Door, POGO’s Report

A group of panelists convened at The New York City Bar Association last week to discuss "The Financial Crisis and the ‘Revolving Door" and a POGO report about the revolving door at the Securities and Exchange Commission.

Watchdog: Interest Rate Manipulation Puts Taxpayers at Risk

U.S. taxpayers "continue to be at risk" from government bailout programs' reliance on a global interest rate called LIBOR, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) said in a report.

SEC Watchdog Finds Recordkeeping in Disarray

The Securities and Exchange Commission (SEC)—a federal regulator that polices recordkeeping on Wall Street, among other things—has failed to properly handle its own records, according to a recent audit by the agency's inspector general (IG).

IRS Awards Whistleblower $104 Million for Exposing Swiss Bank Tax Dodge

The Internal Revenue Service has awarded $104 million to Bradley Birkenfeld, the former UBS banker who blew the whistle on the Swiss bank’s efforts to help Americans evade taxes.

Fannie, Freddie, and Mortgage Regulator Balked at Oversight, Watchdog Says

A federal inspector general says even as Fannie Mae and Freddie Mac were receiving billions of dollars from the government to continue playing a central role in the nation's crippled housing market, the mortgage companies and their regulator were balking at more oversight.

JPMorgan Deploys Former Regulators to Talk to Current Regulators

Amid a sweeping overhaul of Wall Street regulation, JPMorgan Chase, the banking powerhouse, has often deployed former government officials to represent it in Washington.

SUNSHINE WEEK: Revolving Regulators at the CFTC

As part of Sunshine Week, a national initiative to highlight the importance of open government and freedom of information, POGO is releasing a host records obtained by the Freedom of Information Act (FOIA).

Brokerages Demand Greater Transparency from Self-Regulatory Organization

You don’t often hear about regulated entities calling on a regulator to be more open and transparent about its oversight activities. Yet that’s exactly what happened last week at the 2010 annual meeting of the Financial Industry Regulatory Authority (FINRA), a private self-regulatory organization that oversees more than 4,500 broker-dealers operating in the U.S.

Judge's Ruling Helps FINRA Keep Its Records Behind Closed Doors

As described in our latest podcast, POGO sent a letter to Congress last week calling for increased oversight of the Financial Industry Regulatory Authority (FINRA), a self-regulatory organization (SRO) that oversees thousands of securities broker-dealers, and is supposed to be looking out for the interests of the investing public.

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