The Executive Summary of the Inspector General’s report regarding the Bernard Madoff fraud was released on August 31, 2009. In a statement issued by SEC Chairman Mary L. Schapiro upon the release the report, Ms. Schapiro acknowledged the Madoff fraud as a failure by the SEC to protect investors. However, Ms. Schapiro emphasized the SEC’s quick and drastic reaction in the wake of the fraud, stating that the SEC has since been “reviewing [its] practices and procedures, addressing shortcomings, and implementing the lessons learned.” Ms. Schapiro anticipates that the changes implemented by the SEC will help the agency better detect fraud in the future, thus preventing the financial turmoil caused by the Madoff fraud.
Our previous blog entry discussing some of the SEC's recent changes can be found here. In addition, click here for an in-depth analysis of the SEC’s post-Madoff reforms.