What Is Really Going On At The SEC?

If we thought that our nation’s top financial cops had embraced the mantel of truly protecting the public interest, a recent story put forth by CNBC gives us serious reason to pause in that assessment.

This story addresses a leak inside the commission and generates far more questions than answers as to what is really going on inside the offices of the SEC.

Let’s navigate, review, and critique how the SEC Probes Its Own Leak But Can’t Find Culprit:

The inspector general of the Securities and Exchange Commission conducted an intensive, months-long dragnet in 2013 and 2014 involving phone, email and security searches to determine who inside the agency allegedly leaked information to the media about a closed commission meeting discussing the massive JPMorgan “London Whale” settlement, CNBC has learned.

 

Investigators at the Office of the Inspector General produced a 16-page report detailing their findings in March, but that report has never been made public. A copy of the report was obtained by CNBC on Thursday.

The document paints a picture of an SEC in which commission members are at odds with one another and investigators scrutinize their colleagues, staff and the media. It also details just how far the inspector general went to learn how information about a Sept. 12, 2013, executive session commission meeting about JPMorgan had apparently been given to a Reuters reporter, Sarah Lynch.

The wide-ranging hunt for the apparent leaker went all the way to the top: The inspector general’s report says investigators interviewed SEC Chairwoman Mary Jo White, the SEC commissioners, five employees of the Office of the Chair and 18 employees of the Offices of the Commissioners. In their report, investigators said they searched the emails and BlackBerry records of 39 SEC employees and conducted interviews with 53 SEC employees in total. Details in this article are drawn from the inspector general’s report.

Investigators “manually reviewed” each of the SEC employees’ office telephone records and “confirmed whether the employees had deleted any records from their telephones,” the report said. And the inspector general’s staff scrutinized SEC headquarters visitor logs to determine when Lynch and a number of her Reuters colleagues had entered the building during September and October 2013.