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Project on Government Oversight

Michael Smallberg

Investigator

msmallberg@pogo.org

Year Started At POGO: 2006 as an intern

Areas of expertise: Financial Sector Oversight, Revolving Door Conflicts of Interest, Federal Advisory Committees

Michael Smallberg  focuses on the government's oversight of the financial services industry. Smallberg has contributed to POGO’s reports, testimony, letters, public comments, and blog posts on issues such as the revolving door, bailout contractor conflicts of interest, and excessive secrecy at financial regulatory agencies. Prior to joining POGO in 2006, Smallberg interned at the National Archives. He earned a B.A. in American History from Brown University. Smallberg has appeared on CNN and been quoted in The New York Times, The Washington Post, and The Wall Street Journal.

POGO highlights:


High-Speed Trading Cop Used to Represent Wall Street Giants

June 18, 2014

A senior regulatory official tasked with policing U.S. financial markets and high-speed trading used to represent firms with a major stake in the government’s oversight of those matters, according to an ethics disclosure form obtained by the Project On Government Oversight.

How the Clinton Team Thwarted Effort to Regulate Derivatives

April 25, 2014

In April 1998, a decade before a historic crisis wreaked havoc on global financial markets, an obscure regulator saw a potential gap in the government’s oversight of Wall Street and tried to do something about it.

Big Businesses Offer Revolving Door Rewards

March 21, 2013

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.

Overview

February 11, 2013

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

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

February 11, 2013

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.

Exploring Solutions

February 11, 2013

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

Much Ado About Nothing?

February 11, 2013

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

A Regulation Derailed

February 11, 2013

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

Wrinkles in the Ethics Rules

February 11, 2013

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

SEC Alumni Help Firms Get a Break

February 11, 2013

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

July 23, 2012

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

May 29, 2012

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

December 2, 2011

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).

Behind the SEC's Revolving Door

June 2, 2011

The Project On Government Oversight's Podcast Crew talks about the Securities and Exchange Commission's revolving door. A recent POGO study found that more than 200 former SEC employees who left the agency between 2006 and 2010 have taken jobs representing clients before the Commission.

Revolving Regulators: SEC Faces Ethics Challenges with Revolving Door

May 13, 2011

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

December 8, 2010

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

March 18, 2010

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

February 23, 2010

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.

SIGAR Tells Fellow Watchdogs to Shout from the Rooftops

September 15, 2014

All too often, federal watchdogs find alarming evidence of government malfeasance, only to bury their findings in reports that are dense, hidden, or redacted. Thankfully, at least one Inspector General recognizes the value of publicity, and is urging other watchdogs to change their tune.

Watchdogs Publish More Information on Whistleblower Rights

September 4, 2014

Last week, POGO raised concerns that some federal watchdogs were not posting enough information online for agency employees who have questions about blowing the whistle. We’re happy to report that a few watchdog offices are now taking steps to remedy the situation.

Watchdogs and Whistleblowers: A Progress Report

August 26, 2014

Many federal watchdogs have posted clear and comprehensive information about whistleblower protection ombudsmen on their websites, according to a review by the Project On Government Oversight. However, several watchdogs—most notably the Inspectors General at the Department of Homeland Security and U.S. Agency for International Development—have done little to publicize their ombudsmen online, and may be missing an important opportunity to inform agency employees of their whistleblower rights.

Official Gets Waiver to Oversee Obamacare Contractor

July 22, 2014

A veteran of the health insurance industry has been granted a waiver to oversee his former company while he plays a leading role in the government’s efforts to implement Obamacare.

High-Speed Trading Cop Used to Represent Wall Street Giants

June 18, 2014

A senior regulatory official tasked with policing U.S. financial markets and high-speed trading used to represent firms with a major stake in the government’s oversight of those matters, according to an ethics disclosure form obtained by the Project On Government Oversight.

Court Overturns Rare Challenge of SEC-Wall St. Settlement

June 4, 2014

A district judge abused his discretion when he rejected a proposed settlement between the Securities and Exchange Commission and Citigroup, according to an opinion reached today by a U.S. appeals court.

How the Clinton Team Thwarted Effort to Regulate Derivatives

April 25, 2014

In April 1998, a decade before a historic crisis wreaked havoc on global financial markets, an obscure regulator saw a potential gap in the government’s oversight of Wall Street and tried to do something about it.

Retiring SEC Lawyer: Revolving Door Causes Weak Enforcement

April 10, 2014

A longtime lawyer at the Securities and Exchange Commission says that senior agency officials have been more interested in advancing their careers in the corporate world than in policing it aggressively, according to remarks prepared for the lawyer’s recent retirement party.

Will DOJ Hold Tax Cheats Accountable?

February 27, 2014

A bipartisan report released yesterday by the Senate Permanent Subcommittee on Investigations paints a picture of “lax enforcement” by U.S. authorities who have been investigating Swiss bank secrecy and offshore tax evasion.

Head of SEC Given Waiver to Oversee Past Client

February 7, 2014

Mary Jo White, the head of the Securities and Exchange Commission (SEC), will be allowed to oversee her former client, Credit Suisse, according to a new ethics waiver the U.S. Office of Government Ethics posted to its website this week.

SEC Finally Finalizes a Revolving Door Rule

January 7, 2014

After backtracking from a promise to tighten restrictions on its revolving door, the Securities and Exchange Commission is again moving forward with plans to close a loophole in federal ethics rules for senior employees who leave the agency.

Court to Consider Secret Regulation of Wall Street

December 6, 2013

The public has a right to know how the government polices the Financial Industry Regulatory Authority (FINRA), an industry-funded self-regulatory group, according to an amicus brief filed this week by POGO and its allies.

SEC Delays Revolving Door Restriction

November 27, 2013

Months ago, bowing to concern about regulators who leave government and then work their former colleagues on behalf of industry, the Securities and Exchange Commission (SEC) announced that it was tightening restrictions on the revolving door. But a notice published in Monday’s edition of the Federal Register said that the Office of Government Ethics (OGE) was withdrawing the new rule at “the request of the SEC” so that the agency could have more time to “effectively educate affected employees before the exemption revocation takes effect.”

State Dept. Won’t Name Advisers Already in Government’s Public Database

November 19, 2013

For four months, the State Department has refused to say which outside experts are working for the Department as special government employees (SGEs), ProPublica reported last week. Yet, the Project On Government Oversight was able to find more than 100 of the advisers identified as SGEs in an online government database. In other words, some of the information that State has been refusing to provide is hiding in plain sight.

SEC Issues $14 Million Whistleblower Reward

October 8, 2013

An unidentified tipster has received a $14 million federal reward for aiding an “enforcement action that recovered substantial investor funds,” according to a Securities and Exchange Commission (SEC) announcement last week.

SEC to Close Revolving Door Loophole

August 26, 2013

The Securities and Exchange Commission (SEC) is closing a loophole—highlighted by the Project On Government Oversight (POGO) in a February report on the revolving door—that allowed certain employees to lobby the agency immediately after leaving.

Former SEC Enforcer Joins Major Law Firm

July 25, 2013

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.

Retroactive Rights a Victory for Whistleblowers

July 2, 2013

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.

Judge Throws Out SEC Resource Transparency Rule

July 2, 2013

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.

Corzine Faces Rare Charge in MF Global Case

June 28, 2013

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

May 13, 2013

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

April 24, 2013

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

March 20, 2013

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

March 12, 2013

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

March 11, 2013

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

February 19, 2013

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

October 25, 2012

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

October 12, 2012

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

September 11, 2012

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

July 17, 2012

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

June 21, 2012

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

March 15, 2012

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).

Budget Breakdown: Protecting Whistleblowers

February 15, 2012

On Monday, we did a rolling analysis of President Obama's Fiscal Year (FY) 2013 budget request, focusing mainly on our proposed spending cuts for wasteful and unnecessary defense and nuclear weapons-related programs.

GAO Raises Serious Concerns about Conflicts of Interest and Inadequate Transparency at Federal Reserve Banks

October 19, 2011

The professional and financial ties between the directors of the 12 regional Federal Reserve Banks and Fed-supervised firms have created a "reputational risk" for the Federal Reserve System, and the Reserve Banks have not given the public access to key governance documents, according to a report issued today by the Government Accountability Office (GAO).

SEC Withholds Records on Oversight of Self-Regulatory Group

June 16, 2011

Suzanne Barlyn's latest column in Dow Jones Compliance Watch raises new concerns about the Securities and Exchange Commission's (SEC) Freedom of Information Act (FOIA) practices and the lack of transparency at the Financial Industry Regulatory Authority (FINRA) and other self-regulatory groups.

Brokerages Demand Greater Transparency from Self-Regulatory Organization

August 18, 2010

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

March 5, 2010

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.

SIGTARP Gets Down to Business

January 8, 2009

The jury is still out on Neil Barofsky, the recently confirmed Special Inspector General for the Troubled Asset Relief Program (SIGTARP), but it looks like he's off to a promising start.

Big Murtha

November 14, 2006

NORAD, Lies and Audiotape

August 2, 2006

February 25, 2014

Citi Alumni Are Force in Nation's Capital

The Wall Street Journal | By Stephanie Armour and Shayndi Raice

January 17, 2014

SEC reviews holdings of staff in New York

Bloomberg; BusinessDay | BD Live | By Dave Michaels

January 2, 2014

SEC’s Revolving Door To Turn A Little Slower

Government Executive | By Charles S. Clark

November 11, 2013

Slowing the Revolving Door Between Public and Private Jobs

The New York Times; Dealb%k | By Ben Protess

July 22, 2013

A Legal Bane of Wall Street Switches Sides

The New York Times; Dealb%k | By Ben Protess and Peter Lattman

May 13, 2013

Taxpayers Could Foot Bill For Fannie Mae Fraud Settlement

Forbes | By Guest Contributor, POGO's Michael Smallberg