SEC to use “specialists” to fight fraud

Law Professor Tamar Frankel, an authority on securities law, applauds the SEC’s decision to turn to legal specialists to fight financial fraud.

“Staffing the Securities and Exchange Commission with specialized expert examiners and investigators is an idea whose time has come. Not only is the financial market far more complicated than in the past, it is also far larger and global.

“The agency needs experts not only as prosecutors but also as the police on the beat. The private-sector police, such as the accountants, attorneys and rating agencies, have failed to provide the information to the enforcement agencies and limit the spread of fraud. The time has come to remove their function to the government.

“If, together with government specialists, we have internal compliance officers within the corporation, we might achieve a better balance of power and a change in the culture and practice of the actors in the financial system. That, after all, is what is ncessary to ensure a thriving financial system and a stronger economy. The SEC should be complimented on its initiatives.”

Contact Tamar Frankel, 617-353-3773, tfrankel@bu.edu

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