Issa Calls on SEC Inspector General to Launch Investigation

Published: Apr 23, 2010

WASHINGTON. D.C. – House Oversight and Government Reform Committee Ranking Member Darrell Issa (R-CA), sent a letter today to Securities and Exchange Commission (SEC) Inspector General (IG) David Kotz requesting that he initiate an independent investigation regarding the SEC’s decision to move forward with action against Goldman Sachs.

“The circumstances of the filing and subsequent events fueled suspicion that the Commission, or one or more of its officials or employees, may have engaged in unauthorized disclosure or discussion of Commission proceedings in order to affect the debate over financial regulatory legislation currently pending before the United States Senate,” Issa wrote.  “Disclosure rules and procedures at the SEC are important to efforts to prevent insider trading and any violation would be deeply troubling.”

On April 20, eight Members of the House Oversight and Government Reform Committee wrote to Chairman Mary Schapiro to ask whether any prearrangement, coordination, or advance notice had existed between Commission officials or employees and supporters of the legislation, and to request documents and information to assist the Committee’s investigation of this matter.

In the April 20th letter to SEC Chairwoman Mary Schapiro, Issa and his Committee colleagues wrote, “As supported by the Commission’s canons of ethics and as frequently reiterated by you and other Commissioners, the unqualified independence of financial regulators is crucial to the health of the financial system and the U.S. economy.  For this reason, doubts about whether the Commission has scrupulously guarded its independence from the Administration’s partisan political agenda and concerted efforts to manipulate Congressional action are very serious, and should be addressed with full transparency.”