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The Securities and Exchange Commission admitted yesterday (Aug. 11) that since 2005 it had received 45 tips about insider trading by the former hedge fund, Pequot Capital Management, according to the Wall Street Journal. The Pequot affair is one of the most sordid in the history of government regulation. San Diegan Gary Aguirre was working for the agency, and had reason to believe that John Mack, head of Wall Street's Morgan Stanley, may have passed inside information to his close friend Arthur Samberg, head of Pequot. But Aguirre's boss warned that Mack had clout, such as close financial ties to then-President George W. Bush. The agency smeared Aguirre and fired him. Mack wasn't interviewed until it was too late to do anything. Two Congressional committees probed the matter and exonerated Aguirre; Mack should have been interviewed, said the committees. The case also involved the SEC's notorious "revolving door" scam, by which big Wall Street law firms essentially control the agency. One law firm dangled a high-paying job in front of a top SEC official who was looking into the matter (supposedly). Whether anything will be done is questionable. The SEC has not changed its ways.
The Securities and Exchange Commission admitted yesterday (Aug. 11) that since 2005 it had received 45 tips about insider trading by the former hedge fund, Pequot Capital Management, according to the Wall Street Journal. The Pequot affair is one of the most sordid in the history of government regulation. San Diegan Gary Aguirre was working for the agency, and had reason to believe that John Mack, head of Wall Street's Morgan Stanley, may have passed inside information to his close friend Arthur Samberg, head of Pequot. But Aguirre's boss warned that Mack had clout, such as close financial ties to then-President George W. Bush. The agency smeared Aguirre and fired him. Mack wasn't interviewed until it was too late to do anything. Two Congressional committees probed the matter and exonerated Aguirre; Mack should have been interviewed, said the committees. The case also involved the SEC's notorious "revolving door" scam, by which big Wall Street law firms essentially control the agency. One law firm dangled a high-paying job in front of a top SEC official who was looking into the matter (supposedly). Whether anything will be done is questionable. The SEC has not changed its ways.