SEC officials watching porn on taxpayer's dime

http://abcnews.go.com/GMA/sec-pornography-employees-spent-hours-surfing-porn-sites/story?id=10452544

The investigation, which was conducted by the SEC's internal watchdog at the request of Sen. Chuck Grassley, R-Iowa, found 31 serious offenders during the past two and a half years. That's less than 1 percent of the agency's 3,500 employees but 17 of the alleged offenders were senior SEC officers whose salaries ranged from $100,000 to $222,000 per year.

One senior attorney at SEC headquarters in Washington spent up to eight hours a day accessing Internet porn, according to the report, which has yet to be released. When he filled all the space on his government computer with pornographic images, he downloaded more to CDs and DVDs that accumulated in boxes in his offices.

An SEC accountant attempted to access porn websites 1,800 times in a two-week period and had 600 pornographic images on her computer hard drive.

Meanwhile, crooks like Bernie Madoff and "Sir" Allen Stanford were ripping off billions from unsuspecting suckers...er "investors". The SEC also managed to look the other way, while big banks were committing hari kari on the nation's retirement and pension funds.

Government dollars: hard at work. No pun intended.

By the way, even if there are truths in the allegations, this is no doubt a smear campaign against the SEC, probably instigated by the very firms who are being charged with fraud, which will go unnamed. Connect the dots, dear readers. This is a false choice between the bad guys and the bad guys.

The CNBC contrarian indicator

CNBC's Carl Quintanilla interviews the smug Allen Stanford on what it's like to be a billionaire--months before "Sir" Allen was imprisoned for running an $8 billion Ponzi scheme.



http://www.youtube.com/watch?v=XtRkZ3i1ERQ

A few years ago, CNBC did a documentary on venture capital investing in the booming and promising country of Iceland. In 2008, Iceland went bankrupt in a horrific collapse almost overnight.

Now Quintanilla is gearing up to do a special report on carbon credit trading. Guess what's going to happen next in that industry?

Redemption suspension

The words "suspend redemptions" evoked panic and fear in hedge fund investors in 2008 after Lehman Brothers collapsed. Insolvent hedge funds had to delay investor demands for redemptions because they lacked access to liquidity during the financial crisis. A credit freeze ensued, and no one trusted their counterparties who were equally insolvent.

Fine, hedge fund investors are allegedly savvy and required to understand the outsized risks and rewards of investment in hedge funds. An accredited investor needs to have a minimum income of $200,000 and a minimum net worth of $1 million, but most have income and net worth levels much higher than the minimum thresholds. They understand "high risk/high reward"--at least they're supposed to.

But the latest financial reform being pushed by the Obama financial team "to protect consumers" includes the following language: "suspend redemptions to allow for the orderly liquidation of fund assets." This clause is in direct conflict with Securities Exchange Commission (SEC) Rule 2a-7, which provides minimal risk, no volatility, and redeemability for money market funds. In other words, when the average Joe parks his money in a money market account, he expects miniscule interest earned, in return for the safety and liquidity of funds being instantaneously accessible via a computer keystroke or a visit to the bank teller.

What this "financial reform" clause does is allow financial institutions to NOT guarantee your request for cash withdrawal if financial markets are collapsing. In other words, how "safe" is your cash if you can't even access it in times of financial distress--or when there's a run on banks?

This is the same SEC which is chartered to protect investors from unscrupulous swindlers and regulate free, orderly markets. Given their dismal track record of protecting investors from the likes of Ponzi schemers Bernie Madoff and Allen Stanford, it should come as no surprise that savers and investors will become incredibly vulnerable should the next financial iceberg hit again.