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Madoff verdict: The SEC is plain incompetent

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A lengthy report examining the many ways the Securities and Exchange Commission botched its investigations of Bernie Madoff tells us something we already knew: the SEC can be awfully incompetent.

The report by the SEC Inspector General quickly dispenses with the notion that regulators either protected Madoff or covered-up their investigatory failures. But that’s the best that can be said for the SEC in this massive undertaking.

For now, the IG has released a 22-page summary of his findings. But a full 450-page book, outlining all the gory details of regulatory bungling, will hit the shelves in the coming days.

SEC Chair Mary Schapiro commenting on the IG’s findings says Madoff is a “failure we continue to regret.” She says the agency is already reforming its ways and promises not to miss the next $65 billion Ponzi scheme.

Go away Hank

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The Securities and Exchange Commission’s settlement with Hank Greenberg over allegations that he permitted the use of accounting tricks to manipulate earnings at American International Group comes way too late.

Oh sure, it’s great the SEC managed to squeeze $15 million out of Greenberg before agreeing to settle the more then four-year-old civil investigation. But if the SEC really had the goods on Greenberg, it should have gone after him years ago–settlement or not.

Schumer aka Flash Gordon

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There’s an old joke in New York that the most dangerous place is the space between a TV camera and Sen. Chuck Schumer. And the New York Democrat’s love of the limelight certainly was on display late last week with regards to the increasingly controversial subject of high frequency trading.

Schumer’s staff didn’t waste time on Friday in announcing that the senator had sent a letter to the Securities and Exchange Commission, asking regulators to study some aspects of highly-automated stock and commodity trading.

Was SEC slow to probe NIR Group?

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The Securities and Exchange Commission is joining the hunt into just what is going on at NIR Group, a Roslyn, NY small-cap focused hedge fund run by Corey Ribotsky.

The Wall Street Journal reports today that the SEC has sent a subpoena to NIR, seeking information about the stellar returns Ribotsky had reported to investors throughout much of 2008. It appears the SEC wants to know why Ribotsky suddenly froze redemptions in his fund last October, in the wake of Lehman’s demise, if the fund had been doing so well.

Tough questions after Madoff

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Even as Ponzi king Bernard Madoff goes away to prison for the rest of his life and then some, there are still so many unanswered questions — both big and fundamental.

Were Madoff’s sons involved? What did his wife Ruth know? Were the operators of the giant feeder funds that sucked in tens of billions of dollars in investor money in on the charade?

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