SEX, LIES, AND IMPUNITY: Documents Show Top SEC Watchdog Abused Power to Impede Investigation of Favored Staff

Media Contacts: Tim Farnsworth, Executive Strategist at POGO, [email protected]

(WASHINGTON) — POGO has obtained documents of a 2019 government probe into current SEC Inspector General Carl Hoecker that strongly condemned his “serious misconduct” — and recommended Hoecker’s “removal.” Read POGO's investigation.

The non-public results of the investigation were sent to then SEC Chairman Jay Clayton and select members of Congress. The SEC, whose commissioners selected Hoecker in 2013, apparently suspended him briefly without pay for an undisclosed period, but otherwise seems to have taken no action. The probe by the Council of the Inspectors General on Integrity and Efficiency (CIGIE), which keeps watch over an estimated 70 inspectors general in the federal system, also found that Hoecker improperly interfered in an internal investigation of a favored employee, who he had earlier hired and who stood accused of sexual harassment and conducting a consensual affair with a woman who was his direct report.

The council sharply criticized Hoecker after he failed to recuse himself from the investigation, prevented investigators from following up important leads, and failed to act on witness statements made directly to him.

The council condemned not only Hoecker’s actions during the initial inquiry but also his response to its investigation, writing, “It is clear from the record that IG Hoecker changes his story depending on what is most advantageous to him at the time.”

Despite this damning language, the SEC commissioners declined to remove Hoecker as inspector general, the leader of the office charged with policing misconduct by SEC employees as they probe irregularities in America’s multi-trillion-dollar financial markets.

As POGO’s Adam Zagorin writes, “Hoecker remains very much on the job today (sources told POGO last week that his schedule seems as busy as ever). No public statements from the SEC, CIGIE or members of Congress notified of the findings about him have apparently ever linked his name directly to the grave misconduct he was found to have committed.”

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Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that investigates and exposes waste, corruption, abuse of power, and when the government fails to serve the public or silences those who report wrongdoing.

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