CAPITAL VIEWS: Good News Only For Securities Scamsters
24 Apr 13:39
By John Connor
A Dow Jones Newswires Column
WASHINGTON (Dow Jones)--A few numbers from the U.S. General Accounting Office
highlight some of the problems faced these days by the Securities and Exchange
Commission.
-The number of corporate filings has grown at an unprecedented rate,
increasing 60% from 1991 to 2000, while the percent of all corporate filings
that received some sort of SEC review during the same period decreased from
about 21% to 8%.
-Over the past decade, the SEC's Division of Enforcement staff devoted to
investigations increased 16% to about 482 staff years, while the number of
cases opened increased 65% to 558, and the number of cases pending at the end
of the year increased 77% during this time period.
-About one-third of the SEC's staff left the agency from 1998 to 2000. By
2001, this number had increased to 40%. The SEC's turnover rate for attorneys,
accountants and examiners averaged 15% in 2000, more than twice the rate for
comparable positions governmentwide. Although the rate decreased to 9% last
year, turnover at the SEC was still higher than the rate governmentwide.
-From 1992 to 1999, the average tenure of an examiner decreased from 2.9 to
1.9 years and the average tenure for attorneys leaving the SEC had decreased
from 3.4 years to 2.5 years. Moreover, in 2000, 76% of SEC examiners had been
with the agency less than three years.
The GAO recounted these and other such numbers in testimony presented to a
Senate subcommittee Tuesday by Richard Hillman, head of the Congressional
watchdog agency's financial markets and community investment section.
The GAO said the SEC "faces a workload that is growing at a rate much faster
than staffing in an environment where markets have become more complex, global
and technology driven."
And oh yeah, the GAO noted, the collapse of Enron and other recentcorporate
failures and problems "have stimulated an intense debate on the need for
broad-based reform in such areas as financial reporting and accounting
standards, oversight of the accounting profession and corporate governance, all
of which could have significant repurcussions on the SEC's role and oversight
challenges."
In sum, the GAO said, the SEC's ability to fulfill its mission has become
"increasingly strained" due in part to imbalances between the SEC's workload
and staff resources.
All this isn't exactly a news flash. We're even at the stage of crisis
evolution where the Congress, or vocal elements thereof, is promising to ride
to the rescue.
Still, it's worth wondering how it ever came to this.
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(John Connor, a veteran observer of the financial markets and the Washington
scene, is Washington bureau chief for Dow Jones Newswires. He can be reached by
E-Mail at John.Connor@DowJones.Com)
(END) DOW JONES NEWS 04-24-02
01:39 PM |
