House GOP leaders accuse SEC of evading record-keeping laws
WASHINGTON (CNN) — House Republicans launched their own investigation Monday into the Securities and Exchange Commission, accusing the agency of “evasion and subterfuge” when it comes to keeping track of millions of investors who lost money on bad investments.
In what may be the most expansive congressional investigation of the agency since before the Financial Crisis, the GOP-led House Oversight and Reform Committee subpoenaed the SEC to turn over documents and to testify at a public hearing.
It’s one more example of growing anger among Republican lawmakers toward the SEC, which they accuse of having been asleep at the switch for years as the country’s biggest financiers made money and swelled their balance sheets.
“The agency has done an incredible amount of damage to our economy and our financial system with their mismanagement and their failure to make the kinds of regulatory changes that we desperately need to prevent another financial meltdown,” said Rep. Jeb Hensarling, the Texas Republican chairman of the House Financial Services Committee.
Hensarling said the SEC has not been forthcoming about what it knows and what it doesn’t know about the crisis, which has led to losses of more than $6 trillion for investors, and more than $700 billion of taxpayer bailouts.
As the committee’s chairman, Hensarling also oversees the agency’s oversight of smaller financial institutions.
“I have no illusions that the SEC is well-positioned to make key decisions about our financial system, but the American people deserve a thorough accounting of what went so wrong, and we need to be sure we have a clear understanding of what went right,” Hensarling said.
The SEC is being asked to turn over thousands of documents and make personal appearances before the committee.
At issue are the agency’s practices in two areas: the extent to which the SEC has been able to keep track of many high-profile, highly risky investments made by big corporations, and the amount of money it has received from taxpayers to cover losses on those investments