SEC chairman names new director of enforcement

[JURIST] US Securities and Exchange Commission (SEC) [official website] chairman Mary Schapiro [official profile] on Thursday named Robert Khuzami [SEC press release] as the new director of the SEC's Division of Enforcement. Khuzmani replaces former director of enforcement Linda Thomsen, who stepped down from the position [JURIST report] last week. Khuzami has previously served as a federal prosecutor in the US Attorney's Office for the Southern District of New York [official website], and as General Counsel for the Americas for the international investment bank Deutsche Bank AG [corporate website]. In a statement, Schapiro said:

I'm pleased to have Rob join the SEC in such an important role at this crucial time. ... As we work to improve investor confidence in the markets, our enforcement efforts are vital. Throughout his career, Rob has demonstrated an unwavering commitment to prosecuting wrongdoers and protecting citizens. As a former federal prosecutor, Rob is well-suited to lead the SEC's Division of Enforcement as we continue to crack down on those who would betray the trust of investors.
As a federal prosecutor in the Southern District of New York, Khuzami prosecuted a number of financial crimes, and also assisted in the conviction of Omar Abdel-Rahman [Washington Post report] in connection with the 1993 World Trade Center bombing.

Khuzami's appointment as head of the SEC's enforcement division comes as the agency has been rocked by heavy criticism for apparently lax enforcement in the wake of the alleged Ponzi scheme perpetrated by disgraced Wall Street investor Bernard Madoff [JURIST news archive], who faces criminal charges [JURIST brought] brought by the SEC. Similar charges were filed by the SEC against Allen Stanford [JURIST report] earlier this week. In the week following Madoff's charges, then-SEC chairman Christopher Cox said that he would launch an immediate investigation [press release; JURIST report] into how the fraud allegedly perpetrated by Madoff went undetected for so long. In December, then-President-elect Barack Obama [official profile] named [press release] Schapiro as the SEC Chairman, replacing Cox. Madoff was charged with securities fraud in December for allegedly violating the anti-fraud provisions of the Securities Act of 1933, the Securities Exchange Act of 1934, and the Investment Advisers Act of 1940 [texts]. UK financial firm Bramdean Alternatives Limited [corporate website] raised concerns [statement, DOC; JURIST report] about the US financial regulatory process after its value dropped by more than 35 percent following news of its exposure to the fraud.

 

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