It looks like President-elect Barack Obama is on board with the emerging consensus about the Securities and Exchange Commission’s failure to properly probe Bernard Madoff despite several warnings.
At a press conference this morning to announce key members of his financial regulatory team, including SEC chair, Obama declared:
In the last few days, the alleged scandal at Madoff Investment Securities has reminded us yet again of how badly reform is needed when it comes to the rules and regulations that govern our markets. Charities that invested in Madoff could end up losing savings on which millions depend – a massive fraud that was made possible in part because the regulators who were assigned to oversee Wall Street dropped the ball. And if the financial crisis has taught us anything, it’s that this failure of oversight and accountability doesn’t just harm the individuals involved, it has the potential to devastate our entire economy. That’s a failure we cannot afford.
As SEC chair, Obama named Mary Schapiro, a former SEC commissioner and Commodity Futures Trading Commission chair who now runs the Financial Industry Regulatory Authority, the largest regulator for all securities firms that do business with the United States.
