Business

GOP ramps up attacks on SEC over porn surfing

WASHINGTON (AP) — Republicans are stepping up their criticism of the Securities and Exchange Commission following reports that senior agency staffers spent hours surfing pornographic websites on government-issued computers while they were supposed to be policing the nation’s financial system.

California Rep. Darrell Issa, the top Republican on the House Oversight and Government Reform Committee, said it was “disturbing that high-ranking officials within the SEC were spending more time looking at porn than taking action to help stave off the events that put our nation’s economy on the brink of collapse.”

He said in a statement Thursday that SEC officials “were preoccupied with other distractions” when they should have been overseeing the growing problems in the financial system.

The SEC’s inspector general conducted 33 probes of employees looking at explicit images in the past five years, according to a memo obtained by The Associated Press.

The memo says 31 of those probes occurred in the 2 1/2 years since the financial system teetered and nearly crashed.

The staffers’ behavior violated government-wide ethics rules, it says.

SEC spokesman John Nester said in a statement Friday that each of the offending employees has been disciplined or is in the process of being disciplined, and some have already been suspended or dismissed.

“We will not tolerate the transgressions of the very few who bring discredit to their thousands of hardworking colleagues,” said Nester, adding the agency has lately increased penalties.

The memo provides fresh ammunition for Republicans who suspect the timing of the SEC’s lawsuit last week against Wall Street powerhouse Goldman Sachs Group Inc. News of the suit came as the Senate prepared to take up a sweeping overhaul of the rules governing banks and other financial companies.

The memo was written by SEC Inspector General David Kotz in response to a request from Sen. Charles Grassley, R-Iowa. It summarizes past inspector general probes and reports some shocking findings:

— A senior attorney at the SEC’s Washington headquarters spent up to eight hours a day looking at and downloading pornography. When he ran out of hard drive space, he burned the files to CDs or DVDs, which he kept in boxes around his office. He agreed to resign, an earlier watchdog report said.

— An accountant was blocked more than 16,000 times in a month from visiting websites classified as “Sex” or “Pornography.” Yet he still managed to amass a collection of “very graphic” material on his hard drive by using Google images to bypass the SEC’s internal filter, according to an earlier report from the inspector general. The accountant refused to testify in his defense, and received a 14-day suspension.

— Seventeen of the employees were “at a senior level,” earning salaries of up to $222,418.

— The number of cases jumped from two in 2007 to 16 in 2008. The cracks in the financial system emerged in mid-2007 and spread into full-blown panic by the fall of 2008.

About 16 percent of men with Internet access at work admit to looking at online porn while at the office, according to a 2006 survey by Websense Inc.

Former SEC spokesman Michael Robinson said he shares the public’s outrage about SEC staffers who enjoyed porn on the taxpayer dime when they were supposed to be keeping the markets safe.

“That kind of behavior is just intolerable and atrocious,” said Robinson, now with Levick Strategic Communications. He said he expects the head of the SEC, Mary Schapiro and her team, are “very focused on” the issue.

Schapiro has been parrying GOP complaints about the Goldman Sachs lawsuit, which agency officials hoped would mark a new era of tougher oversight of Wall Street. They followed high-profile embarrassments including the failure to catch Ponzi kings Bernard Madoff and R. Allen Stanford.

Republican lawmakers also accused the SEC of being influenced by politics. The SEC’s commissioners approved the Goldman charges on a rare 3-2 vote. The two who objected were Republicans.

Schapiro is a registered independent who has been appointed by presidents of both parties.

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Associated Press writer Christine Simmons contributed to this report.

  • rick013

    Let’s see, 33 guys were charged and eight were let go. That still leaves 25 more occupying a seat and drawing an incredible salary. Imagine 25 are still in the SEC. Doesn’t say much for their ethics and work habits. No wonder we’re in a mess. Could it be that these children need watching by responsible adults?

  • awlhattinokaddle

    It’s worth the trip to go to skankwire.com/Deery’s Mom!

  • libertyatstake

    Maybe it was insider trading … maybe the SEC guys were investors in the porn sites … maybe we need a massive government commission to investigate in the name of protecting porn site consumers … LOL!

    http://libertyatstake.blogspot.com/
    [For a light hearted take on our present peril]

  • tomdoff

    These SEC officials did the right, moral thing. When faced with the choice of keeping tabs on the obscenity of our financial system, or watching ‘net porn, they chose the lesser of the two debaucheries.

  • loudog

    Too bad Republicans weren’t a little more concerned before the housing bubble popped and the economy tanked.

    • anniebanannie

      “http://sweetness-light.com/archive/bush-called-for-reform-17-times-in-2008

      Barney Frank and Chris Dodd said –>Oh, don’t worry, we have it all under control…….

      • loudog

        The damage was done by 2006.

        • anniebanannie

          oh bs

      • Kerrvillian

        Yep. But don’t wait for the media to play their own file footage to show what really happened.

    • rick013

      If memory serves, the dims controlled congress when the housing bubble burst. BTW, Bush did try to control the Fannie and Freddie May but the dim congress wouldn’t let him.

  • elyriaohio

    Most of them aren’t qualified to analyze Wall-Street trading, just a bunch of lawyers chasing rumors of misconduct.They were warned about Bernie Madoff years ago & did nothing.

  • Kataklysmic454

    No wonder we wound up getting screwed.