responsive documents - crew: sec: regarding reforms in wake of madoff scandal: 3/16/2012 -...

8/2/2019 Responsive Documents - CREW: SEC: Regarding Reforms in Wake of Madoff Scandal: 3/16/2012 - FOIA.enclosures

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FY12 Roll Out PlanCollege of Leadership Development FY12 Roll Out Plan

LD10l LD201 LD301 LD304 LD400 LDSOO LD600Non AIlEIilp New Supy3 Executive New Allsupervisory Supy yrs Potential Senior Senior

tenure SK1S- Officer OfficersSK17

Required-4 Required- Required Required Required Req Req-14 3 3 1 2 11

Funded-3 Funded 2 Funded Funded Funded Funded Internal2 2 1 0 Faculty


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MEMORANDUM~To:From:Re-Date:

SEC/OHR/SECU/Steve MosierSEC/OHR/SECU/CLD-Marie WestbrookFOIARequest-ll-08196-FOIASeptember 14, 2011

Background: OnFebruary. 14, 2011 SECUfilledthe position of Dean of the Collegeof Leadership Development (CLD)with a mandate to develop a sound strategy foradvancing the Commission's stature in promoting effective leadership at all levels ofthe agency. As the Commission enters an unprecedented period ofoperationalchallenges (limited resources, increased performance demands associated withDodd/Frank, execution of internal organizational improvements, uncertainty in2012 funding, proposed bilateral budget deficit reduction strategies to limitregulatory agency funding, Congressional oversight on the status of Dodd /Frankrule writing progress and increased pressures on federal sector employees) oursuccess will rely on our ability to be operationally effective at all levels of theCommission. Our investment in leadership development will be geared tosupporting operational effectiveness and strategic leadership skills.Status Report:. In the past six months we have evaluated past expenditures on leadershipprograms, developed a CLDstrategic plan, continued with the roll out of theSuccessful Leaders Program, launched the pilot "team leader course" and a series ofleadership electives, and completed vendor selection for partnering on a core ladderof courses in support of the framework for the "future state" of leadershipdevelopment with SEC.

Future State: One of our strongpoints is our knowledge of effective leadershipdevelopment strategies and programs within the financial regulatory agencies andhow to align our investment in leadership development to address criticaloperational and strategic issues. In order to provide leadershtp development at alllevels we propose to stand up a sequential ladder of courses and electives,appropriately staged to reflect available resources and agreed to priorities andaddress individual division/office needs through funds allocated for managementconsultations. (See Illustration: Attached.)


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FY 2011Approved New Hires


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From:To:Subject:Date:Attachments:

J ob n s on . J u IiRSEIOGeEW : A L ook B ack a t 2010T uesda y, N ovem ber 29 , 20114:45:15 PM201 0 S amp le o f A c compl is hment s. do c

3 - u lJ . 3 -oluuol1'Division of Risk, Strategy, and Financial Innovation2 0 2 - 5 5 1 - 8 1 0 7

-_-- __ .._------_From: Scha piro , M ary L .Sent: Thursday, Decem ber 30, 2010 10:55 A MTo: A LL SE C U SE RSSubject: A Look B ack a t 2010

Dear Colleagues,Before we ring in the New Year, we should pause for a moment to consider all that has been,accomplished in 2010.From Enforcementto Investor Education - from Trading and Markets to the ChiefAccountants Office -- the workload has been intense and the achievements have been many.Not just hereand there, but across the entire agency. Every office and department, whetheron the front lines or working hard behind the scenes, contributed meaningfully to a successful2010.As the attached sample of accomplishments shows, we've all been working hard to protectinvestors and ensure fairness in our markets.In 2010, we forged ahead with an aggressive rule-making agenda - an agenda that wasmoving along at a rapid pace even before the passage of the Dodd-Frank Act. Among otherthings, we adopted rules to enhance the resiliency of money market funds, to provideinvestors with more meaningful information about municipal securities, to curtail pay-to-playpractices, and to promote market stability. And, we proposed measures to improve the waymutual funds are marketed, to clarify the meaning of a date in a target date fund's name andto revise the disclosure, reporting and offering process for asset-backed securities.Then, with the passage of Dodd-Frank, we took on greater responsibility, setting out to createthe contours of a new whistleblower program, to facilitate the registration ofhedgefundadvisers, and to establish an entirely new regulatory framework around the over-the-counterderivatives market.In the past year, we also saw the newly-restructured Enforcement Division bring a series ofcomplex and significant cases, demonstrating the depth of knowledge within theagency. And, we saw our examinations program begin to adopt a more risk-based, uniform,natiou-wide approach to inspections.


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Further, we took a major step forward by consolidating all the tips, complaints and referralswe receive into one centralized database. And, we improved our institutional capacity byfocusing on professional development and bringing new talent with specialized skills into theagency.On top of all that, we also responded rapidly to the market events of May 6th, preparing twostaff reports with participants from across the agency -- along with the CFTC -- analyzingthe immediate cause and effects of the day. Of course, to your credit, months earlier, we hadalready launched a vigorous review of the structure of our markets, which has resulted in aseries of market reforms including rules that effectively prohibit broker-dealers fromproviding unfiltered access to exchanges; rules that trigger circuit breakers for certainindividual stocks; rules clarifying up front how and when erroneous trades would be brokenand rules that effectively prohibit "stub quotes" in the u.s. equity markets. Importantly, wealso proposed establishing a consolidated audit trail system that would allow us to trackinformation related to trading orders received and executed across our many securitiesmarkets.At the same time we were doing all that, we worked hard to create a more open andcollaborative institutional environment, continued to bring new leadership on board, andmounted field hearings and round tables on subjects as diverse as market structure andmunicipal securities.And, that's just a small sample.I hope you will join me in looking back at this year with pride and a little bit of amazementat all we accomplished.You have truly lifted our performance to a new level and for that, Ihank you.I hope you and your family have a Happy New Year.Mary


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A Slice of the SEC'S Accomplishments in 2010:In 2010, the SEC continued reforming its procedures, revamping its systems, bringing complexenforcement actions, better targeting its examination efforts and adopting a series of rulesintended to protect investors and promote fairness in the markets. Additionally, it began workingto fulfill its obligations under the recently-enacted Dodd-Frank Wall Street Reform and ConsumerProtection Act.Reinvigorating and Restructuring the Enforcement Program

Brought a series of financial crisis and mortgage-related enforcement cases, includingState Street, Citigroup, Morgan Keegan, Goldman Sachs, ICP Asset Management and aTARP-related fraud action. Brought other significant actions including:

o Financial fraud cases against Dell, Diebold, and other public companies;o Proceedings charging Banc of America Securit ies with fraud in connection withthe investment of proceeds of municipal securities;o Proceedings charging the State of New Jersey with misrepresenting and failing todisclose to municipal bond investors that it was underfunding its largest pensionplans - the first state ever charged by the SEC for securities law violations;o Actions charging Quadrangle Group and its former principal with participating in akickback scheme to obtain investments from New York's largest pension fund;o Actions charging twelve defendants with participating in various kickbackschemes to manipulate the volume and price of microcap stocks and illegallygenerate stock sales;o Additional charges (and defendants) in ourcontinuing investigations concerninginsider trading rings involving personnel at hedge funds, law firms, publiccorporations, and financial institutions; and,o A $67.5 million settlement with the former Countrywide Financial CEO, whichincluded the largest-ever penalty paid by a public company's senior executive inan SEC settlement.

Created and staffed five national specialized units - focused on the key areas ofStructured and New Products, Market Abuse, Municipal Securities and Public Pensions,Asset Management, and FCPA - as platforms to refine our expertise and make us betterable to detect trends, links, and patterns related to fraudulent conduct. Introduced new cooperation tools, similar to those used by criminal authorities, to securethe cooperation of persons who are on the "inside" by rewarding cooperation throughreducing or foregoing charges and sanctions in connection with Commission

investigations and related enforcement actions. In December, the SEC used this toolwhen it charged a former executive of Carter's Inc. with financial fraud - but not thecompany, which cooperated with the agency. Continued to build up a new Office of Market Intelligence, which triages, reviews, andanalyzes the enormous number of t ips, complaints and referrals the agency receiveseach year, conducts market surveillance, and performs other investigative outreachfunctions.


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. Participated in a nationwide operation, organized by the Financial Fraud Task Force, totarget investment fraud. It included the initiation or resolution of 35 SEC actions against130 defendants who improperly obtained approximately $1.8 billion from more than20,000 investors. Obtained court orders for $200 million more in disgorgement and $800 million more inpenalties than in 2009. Through December 13, 2010, we obtained orders for about $1.9

billion in disgorgement. And, we obtained orders for about $1.2 billion in penaltiesthrough December 13, 2010. The SEC distributed an estimated $2.2 billion to injured investors in FY 2010 - a morethan 120 percent increase over the amounts distributed in 2008. Also in FY 2010, the SEC sought emergency relief from federal courts in the form oftemporary restraining orders (TROs) to halt ongoing fraudulent conduct in 45 actions andsought 56 asset.freezes in actions to preserve funds for the benefit of investors. Incontrast, during FY2008, the SEC sought 39 TROs and obtained asset freezes in 46actions.

Revamping Tips and Complaints Procedures Created a centralized database so that all tips, complaints, and referrals are funneled intoone location. This is part of an ongoing process to revamp the way in which the agencycollects, analyzes and responds to the massive number of tips and complaints it receiveseach year.

Engaging in a Significant Investor-Focused Rule-making Agenda Money market funds: Adopted rules that enhance the risk-limiting condit ions of ourmoney market fund regulation by strengthening credit quality, liquidity and maturitystandards, as well as introducing stress testing requirements and mandating newreporting of money market fund holdings. Municipal securities: Adopted rules that provide investors and other market participantswith more meaningful and more-timely ongoing information regarding municipaisecurities. Proxy access: Adopted rules to facil itate the effective exercise Q f the rights ofshareholders to nominate directors to the Boards of the companies they own. Proxy mechanics: Issued a concept release on the process through which proxies aredistributed and votes are tabulated -- to ensure that the proxy voting system as a wholeoperates with the degree of reliability, accuracy, transparency and integrity thatshareholders and companies have the right to expect. E-Proxy. Revised the e-proxy rules so that additional materials could be provided withthe company's notice to better inform investors. Pay-to-play. Adopted rules to curtail pay-to-play practices by advisers to governmentclients, l ike public pension plans.


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Alternative uptick rule: Adopted an alternative uptick rule that is designed to promotemarket stability and preserve investor confidence by restricting short selling from furtherdriving down the price of a stock that has dropped more than 10 percent in one day. Form ADV: Adopted rules requiring advisers to provide clients with brochures that plainlydisclose such things as the advisers' business practices, fees, conflicts of interests anddisciplinary information. 12b-1 Fees: Proposed rules to create a new and more equitable framework governingthe way in which investors pay the costs for mutual funds to be marketed and sold. Inaddition, the rules would limit the amount of asset-based sales charges that individualinvestors pay. Target date funds: Proposed rules to help clarify the meaning of a date in a target date

fund's name and enhance the information in fund advertising and marketing materials inorder to assist investors preparing for retirement. Short-term borrowing: Proposed rules that would require public companies to discloseaddit ional information about short-term borrowings and issued interpretive guidance toimprove the discussion of liquidity and funding in management's discussion and analysis,

with a focus on addressing "window-dressing" or "debt masking" issues. In addition, thestaff of the Division of Corporation Finance sent a "Dear CFO letter" to a variety off inancial services firms reminding the firms of their disclosure obligations and accountingissues with regard to Repo 105 and similar transactions .. Asset-backed securities: Proposed rules that would revise the disclosure, reporting andoffering process for asset-backed securit ies to better protect investors in thesecuritization market.Under Dodd-Frank, the Commission has been engaging in signif icant rule-making activityincluding: Asset-backed securities: Proposed rules that would enhance ASS disclosure by: 1)

requiring registered ASS issuers to perform a review of the bundled assets that underliethe ASS; 2) requiring an ASS issuer to disclose the nature, findings and conclusions ofthis review of assets; and, 3) requiring the issuer or underwriter for both registered andunregistered ASS offerings to disclose the findings and conclusions of any reviewperformed by a third party that was hired to conduct such a review.Also proposed rules that would require issuers of ASS - and credit ratiligagencies thatrate ASS - to provide investors with new disclosures about representations, warranties,and enforcement mechanisms. Provided relief to ASS issuers to enable them to omitratings disclosure from prospectuses following rescission of Securities Act Rule 436(g)under the Dodd-Frank Act.

Whistleblower: Proposed a whistle blower program, that would reward individuals whoprovide the agency with high-quality tips that lead to successful enforcement actions.

Say-on-Pay: Proposed rules, under Dodd-Frank, that would govern shareholders rights tocast advisory votes on executive compensation and "golden parachute" arrangements. Municipal advisor registration: Adopted a temporary rule requiring municipal advisors toregister with the SEC and developed an on-line temporary registration system, in veryshort order. We proposed a permanent rule to provide for municipal advisor registration.


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Strengthening oversight of investment advisers: Proposed new rules to facilitate theregistration of advisers to hedge funds and other private funds with the SEC; implement amandate to require reporting by certain advisers that are otherwise exempt from SECregistration; increase the asset threshold for advisers to register with the SEC; and define"venture capital fund" as well as the term "family office." Specialized disclosures: Proposed rules requiring new disclosures about mine safety,

conflict minerals from the Congo, and payments to governments by the extractiveindustry.Also under Dodd-Frank, in the area of security-based swaps, the agency has: Security-based swap data repositories: Proposed new rules that would require security-based swap data repositories to register with the SEC. The proposed rules also layoutother requirements with which SDRs must comply. Security-based swap fraud: Proposed a new rule to help prevent fraud, manipulation,and deception in connection with the offer, purchase or sale of any security-based swap- as well as in connection with ongoing payments and deliveries under a security-basedswap. Security-based swap reporting and dissemination: Proposed new rules detailing howsecurity-based swap transactions should be reported and publicly disseminated. Security-based swap conflicts: Proposed rules intended to mitigate conflicts of interestfor security-based swap clearing agencies, security-based swap execution facilit ies, andnational securities exchanges that list for trading security-based swaps. Pre-enactment security-based swaps reporting: Adopted an interim rule that requires 'certain security-based swap dealers, major security-based swap participants and otherparties to report any security-based swaps entered into prior to July 21, whose terms hadnot expired as of that date. Definition of key terms: Proposed rules OOintlywith the CFTC) to further define a seriesof terms related to the security-based swap market, including "swap dealer," "security-based swap dealer," "major swap participant," "major security-based swap participant,"and "eligible contract participant." Mandatory clearing: Proposed rules to establish a process for clearing agencies toprovide information to the SEC about security-based swaps that-they plan to accept forclearing. This information is designed to aid the SEC, among other things, in determiningwhether such security-based swaps are required to be cleared.

- End-user exception from mandatory clearing: Proposed a rule to specify the steps thatend-users must follow when engaging in a security-based swap transaction that is notsubject to mandatory clearing.Addressing Market Structure Issues and Responding to Mav 6th

In addition, a team of experts responded to the May 6th market events and, jointly with theCFTC, prepared a staff report analyzing the immediate cause and effects of the day. Wellbefore then, the agency launched a vigorous review of market structure - through a conceptrelease -- and is now seeking public comment on a wide range of issues to help facilitate theCommission's review. This year, the SEC has:


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Sponsored access: Adopted rules that would effectively prohibit broker-dealers fromproviding their customers with unfiltered access to exchanges and other alternativetrading systems - and that would assure broker-dealers implement appropriate riskcontrols. . Large trader: Proposed the creation of a large trader reporting system that wouldenhance the SEC's ability to identify large market participants, collect information on theirtrades, and analyze their trading activity. Consolidated Audit trail: Proposed a new rule that would require the SROs to establish aconsolidated audit trail system that would enable regulators to track information related totrading orders received and executed across the securit ies markets. Circuit breakers: Approved rules that will require the exchanges and FINRA to pausetrading in certain individual stocks if the price moves 10 percent or more in a five-minuteperiod. This pilot program applies to stocks in the S&P 500 or the Russell 1000, as wellas certain exchange-traded funds. Erroneous trades: Approved new rules clarifying up front how and when erroneoustrades would be broken. Stub quotes: Approved new rules proposed by the exchanges and FINRA to strengthenthe minimum quoting standards for market makers and effectively prohibit "stub quotes"in the U.S. equity markets. Options exchanges: Proposed rules that would prohibit an options exchange fromimposing unfairly discriminatory terms that inhibit or prevent access to displayedquotations, and would limit the fees that an options exchange can charge investors andothers wishing to access a quote on an exchange.

Ensuring Appropriate Disclosure by Companies and Financial Institutions

Created three new specialized offices to focus on large financial institutions, asset-backed securit ies and other structured products, and securities offering trends. Participated in the PCAOB's outreach program for auditors of smaller companies toimprove financial reporting at these companies. Completed reviews of the global Fortune 500 companies that publicly report using IFRS. Issued a "Dear CFO" letter to registrants operating in the financial services industry thathave Significant mortgage-related activities to remind them of their disclosure obligationsin light of concerns about potential risks and costs associated with mortgage andforeclosure-related activities or exposures.

Continued in preliminary stages of a comprehensive review of the core disclosurerequirements to assure that the SEC is requiring the right information in an accessibleformat.


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Ensuring High Quality Accounting Standards Undertook efforts to complete the staff IFRS Work Plan in 2011, which -- it is anticipated -- will provide the necessary information to enable the Commission to make adetermination in 2011 on whether and if so, how to incorporate IFRS in the U.S. capitalmarkets for domestic registrants. The IFRS Work Plan contemplates a number of

significant work steps including reviewing the sufficient development and application ofIFRS and the independence of the standard setting for the benefit of investors.

Improving Examinations and Inspections Completed a rigorous self-assessment process to build a national exam program that willbetter protect investors by allocating resources to where they are needed most. Theexaminations unit instituted a new national governance structure that breaks down silosby emphasizing ccnsistency in policy, program, and deployment of r isk-focusedstrategies. Created a more risk-focused approach to examinations, calling on expertise across the

agency. Among other things, the examinations unit began requiring routine outreach tothird parties such as custodians, counter-parties and customers during exams to verifythe existence and integrity of client assets managed by the firm. Additional measuresincluded expanding the use of exams of joint or dual registrants such as affiliated broker-dealers and investment advisers. Enhancing technology tools to support better data analysis, risk assessment andsurveillance, and automated examination process. Established specialized groups within the examination unit in areas such as Structuredand New Products, Valuation, Marketing and Sales Practices, Market Structure andTrading, and Fixed Income and Municipal Securit ies. Began conducting more rigorous reviews of firms before the examiners enter thepremises, and creating a more complete exam guide that focuses not only on obvioussigns of fraud but also more subtle signals that deserve closer inspection, such as a firmusing an unknown accountant. Continued enhancing the training of examiners, including re-focusing on exam planningand tracking. The agency enabled hundreds of staffers to be tralned to become CertifiedFraud Examiners. To date, 314 exam staff and managers have become CFEs. This hashelped better mobilize the exam group to be alert for indications of fraud on exams.

Recruited new leadership throughout the examinations unit,including specialists withexpertise in areas such as risk management, quantitative analytics, trading, portfoliomanagement, valuation and technology.

Engaging in Educational Outreach Launched the inaugural Teacher Training Workshop in partnership with the NYSEEuronext.


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Issued 16 Investor Alerts and Bulletins - more than four times the previous year--including one targeting recipients of the BP Oil Spill Payout and another warning about afraud targeting the Deaf community which was translated into American Sign Language.

Cooperating with the International Community Repatriated over $34,000,000 of fraud proceeds to the United States. Submitted 605 requests to foreign authorities for enforcement assistance and processedmore than 450 requests for assistance from the SEC's foreign counterparts - a 12%increase over FY 2009. Handled a record 401 tips, complaints and referrals from the Enforcement Division andforeign regulators - a 59% increase over FY 2009 Developed IOSCO Principles Regarding Supervisory Cooperation and drafted a reportintended to foster greater cooperation with foreign regulators - cooperation that will helpthe SEC gain access to regular supervisory information and conduct onsite exams ofregistrants located in foreign jurisdictions. With new leadership in Nigeria committed to restoring the integrity of the markets, theSEC's international affairs office sent a team of staffers to Abuja and Lagos to assesstheir markets and recommend reforms -- most of which were accepted. The Nigerianmarket regulator has recently brought over 200 enforcement actions against marketparticipants, and appointed an administrator to take over the Exchange.

Continuing to Bring on New Leadership Continued to bring on board new leadership across the agency including a new directorof the inspections and examinations program, a new Chief Information Officer, ChiefFinancial Officer, Chief Learning Officer, Ethics Counsel, Chief Trial Attorney and a new

head of the Atlanta regional off ice. Hired the agency's first Chief Operating Officer, who is leading the staff in strengtheningthe SEC's technology, operational risk assessment, f inancial reporting and internalcontrols.

Continuing to Eliminate Silos Continued to re-define how the agency does its work by emphasizing collaboration. Forinstance, establishing a number of cross-functional teams to model this behaviorthroughout the organization - as evidenced by such things as the Tips, Complaints and

Referrals team, the Consolidated Audit Trail working group, the Muni Field Hearingsteam, the Life Settlements Task Force, the Investment Adviser/Broker Dealer Studygroup and the Broker-Dealer Risk Assessment Working Group. Created cross-divisional rulemaking teams dedicated to implementing the Dodd-Frank

Act. Integrated broker-dealer and investment adviser examinations to ensure that people withthe right skill sets are involved in examinations of regulated entities.


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Incorporated a review of collaboration into senior officer performance metrics.###


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L u e t k e n h a u s , J a s o nFrom:Sent:To:Subject:

Johnson, JuliMonday, November 28, 2011 12:20 PMRSFI_OGCFW: SEC Administrative Notice: Tips, Complaints and Referrals (TCR) Intake and ResolutionSystem Implementation

3 - u l l 3 - o I u u o t & .Division of Risk, Strategy, and Financial Innovation202-551-8107

From: SECAdministrative NoticesSent: Sunday, March 13, 2011 8:22 PMSubject: SECAdministrative Notice: Tips, Complaints and Referrals (TCR) Intake and Resolution System Implementation

Tips, Complaints and Referrals (TCR) Intake and Resolution System ImplementationMarch 14, 2011The Tips, Complaints and Referrals Executive Steering Committee is pleased to announce that the new Tips, Complaintsand Referrals (TCR) Intake and Resolution system is deployed and ready for use. In conjunction with this deployment anew TCR Website is also being launched. The TCR Website containslinks to the TCR Intake and Resolution Policy and Procedures, user guide, training material, support information, and a listof points of contact.The TCR Intake and Resolution system is to be only used for authorized government purposes. 00 not distributeinformation retrieved from TCR to any unauthorized individuals. Please read the applicable policies and proceduresbefore accessing the system. By logging into this system the user acknowledges that he/she has read the pollcles andprocedures and agrees to abide by them.The link to the TCR Intake and Resolution system is https:lladc-sec-prodsoa11.sec.gov:7011ITCRWeb/facesllogin.Accounts have been created for staff authorized to use the system. The user 10 and password to access the system isthe same as your network user 10 and password. If you are unable to access the system and you believe you shouldhave been granted access please contact your division/office points of contact.Please note that the Tips, Complaints and Referrals (TCR) Transitional Repository system will be available for search onlypurposes for a limited time.If you have any questions or concerns, please contact Juli Johnson ([email protected]), Howard Kaplan([email protected]), or your TCR point of contact.

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Luetkenhaus, JasonFrom:Sent:To:Subject:

Johnson,Jul iMond a y, No vembe r 28,201112:15 PMRSFI_OGCFW : Wh is tle blo we r R ele as e Dep lo ye d

/}ull / } o / w . 4 o n .Division of Risk, Strategy, and Financial Innovation202-551-8107

From : Vu, NgocS en t: F rid ay, A ugu st 12, 20~1 12:44 AMTo: J oh ns on , J uli; C oh en , S te ph en L .; Haw ke , D an ie l; H ea d, M a ry S .; S ok obin , J ona th an ; S to rc h, A dam D .; S po rk in ,T homas ; F is hma n, R ob ert; B a sile , J ulie ; L ew is , C ra igC c: H es lop , J effe ry; B a yer, T homa s A .; W a ls h, L ori; K ap la n, H ow ard; C ara do nn a, C hris ; W a lk er, J effre y; B ov a, J ohnS ub je ct: Wh is tle blo we r R ele as e Dep lo ye dT he W h istleblow er R elea se deploym ent bega n a t 8 P M a nd w as c om pleted shortly a fter m idn ight w ith no issues. The newre le as e w as v erified a nd a va ila ble a t 12:02 AM . The entire deploym ent tea m to inc lude developers, D MZ support,d ata ba se a dm inis tra to rs , etc . d id a g re at jo b.P lea se let us k now if you enc ounter a ny prob lem s w ith the system .T ha nk y ou,Ngoc

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Are You a POC for a TCR?

Insider Home > What's Happening > Administrative Notices > May 2011May 2011

Are You a POCfor a TCR?FAQs on Tips, Complaints and Referrals (TCRs)Q. I am a designated point of contact (POC) for TCRs, I review incoming tips todetermine who they should be assigned to, Do I need to worry about any conflicts?A. Yes. Determining who should work on a matter can be considered personal andsubstantial participation in the matter. Therefore, If you hold stock over the deminimis limit ($15,000) in a company about which you have received a TCR, youshould immediately stop working on that matter and inform your supervisor of theconflict. Criminal conflict of interest laws prevent us all from working on any matterthat could affect the financial interest of a company in which we own stock.Q. What if I don't own stock, but I receive a TCR about a company where mymom works?A. This can also present a problem for you because you have a "coveredrelationship" with the company ("covered relationships" include a company whereyour spouse, parent,or dependent child works). That can raise appearance issues.We never want to have circumstances that could cause the public to question theintegrity of government service.Q. Where can I get more information?A. Call a member of the Ethics Team.Shira Pavis Minton (DAEO): ext. 1-7938, [email protected] Love: ext. 1-5171, [email protected] Connor: ext. 1-5128, [email protected] Rittner: ext, 1-5134, [email protected] Purcell: ext. 1-5197, [email protected] (M 7:30-4, W & Th 7:30-1 :30 only)Danae Serrano: ext. 1-7934, [email protected] Griffin: ext. 1-7933, [email protected] (EPS)Frank Hemphill: ext. 1-7941, [email protected] (EPS)Izabela Antonova: ext. 1-7942, [email protected] (EPS)

/whats_happen ing/at_ the_sec/ may_20 11/poc_tcr-050 511.html

http://intranet.sec.gov/whats_happening/at_the_sec/may _20 l l/poc _tcr-050511 .html

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11/28/2011
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]://intranet.sec.gov/whats_happening/at_the_sec/mayhttp://intranet.sec.gov/whats_happening/at_the_sec/maymailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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From the Chairman: Whistleblowers Page 1 of2

.lnslder Home > What's Happening > Administrative Notices > August 2010August 2010

From the Chairman: WhistleblowersDear Colleagues,The "Wall Street Reform and Consumer Protection Act" (the "Act") expands theSEC's powers to pay whistleblowers for valuable tips and expands protections towhlstleblowers,As a result, no longer does our whistleblower program cover only tips about insidertrading. Instead, it covers tips about any violation of the federal securities laws.This means our agency could see an increase in the number of tips, complaints andreferrals ("TCRs") that we receive.As you know, anyone of us could be the recipient of the TCR, and the informationcould come to us in any office, through e-mail, regular mail or by phone. Toensure we properly track the tips provided, every employee should knowthe proper manner in which to handle the information.Under the Act, the SECmust pay an award to: eligible whistleblowers who voluntarily provide the Commission with original information about aviolation of the federal securities laws that leads to the successful enforcement of a covered judicial or administrativeaction, or a related action, as defined by the ActBut before anyone can receive an award, the SECmust issue final regulations -both to establish procedures for whistleblowers and to allow the Commission tointerpret certain key components of the provision. Those regulations, currentlybeing drafted, must be issued within the next 270 days. It is important to note,however, that although individuals will have to comply with the regulations whenpassed, in the meantime they can still submit TCR information to the Commissionthat could ultimately lead to a successful award.Pending the adoption of final rules implementing the Act, all employees shouldadopt the following procedures for responding to questions about the new Act andfor handling' TCRs from individuals identifying themselves as whistleblowers: Inquiries concerning the Act: Individuals who previously filed awhistleblower complaint may ask about the law's impact on their ability toreceive an award. The new law is not retroactive. Any inquiry about the newlaw should be directed to the SECWebsite, which has been updated withcurrent information. This approach will ensure a consistent response by the SECand will reduce the risk of misinformation. Staff should refrain from attemptingto interpret or explain the law to whistleblowers.

Submission of information: Similarly, individuals claiming to bewhistleblowers who contact the SECwith information about a possible violation

http://insider.sec.gov/whats_happening/at_the_sec/august_2010/whistleblowers-080210.h...11128/20 11
http://insider.sec.gov/whats_happening/at_the_sec/august_2010/whistleblowers-080210.h...11128/20http://insider.sec.gov/whats_happening/at_the_sec/august_2010/whistleblowers-080210.h...11128/20


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From the Chairman: Whistleblowers Page 2 of2

of the federal securities laws should be encouraged to submit the information inwriting, preferably using the SEC'sTCRWeb form. A link to the form can befound on the SECwebsite in the Investor Information section. Care should betaken to explain that electronic submission of the information will (a) complywith the statutory requirement that the information be submitted in writing, and(b) facilitate a precise record of the timing of receipt of the information by theSEC. Information may also be mailed to the SEC in hard copy. To the extentpossible, staff should encourage individuals who wish to submit theirinformation in writing to transmit the information using a trackable mode ofdelivery. Whistleblower information received by the home and regional Divisionsand Offices should be processed in accordance with paragraph 6 of SECAdministrative Regulation SECR3-2, Tips, Complaints and Referrals IntakePolicy, March 10, 2010.

Additional guidance concerning the handling of whistleblower TCRs is available onthe Insider page at http://insider/divisions_offices/hqo/ENF/interim-procedures-tcrs.pdf. If you have additional questions, Tom Sporkin and SaritKlein in the Office of Market Intelligence are leading our current efforts to puttogether the new whistleblower office called for in the Act.I look forward to seeing how this new program aids our efforts to protect investors.Mary

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Intake Policy on Tips, Complaints and Referrals Page 1 of I

Insider Home > What's Happening > Administrative Notices > March 2010March 2010

Intake Policy on Tips, Complaints and ReferralsTO: All StaffSUBJECT:Intake Policy on Tips, Complaints, and Referrals Received bySECStaffToday the SEC issued a new administrative regulation setting out the agency'sintake policy regarding the processing of tips, complaints, and referrals ("TCRs")received by SEC staff, The policy delineates the responsibilities and actionsrequired of each employee should they receive a TCR regarding the actions of anindividual, firm, or company.This policy applies to all SEC personnel, including fellows, interns, contractors, oranyone employed on a full-time or part-time basis by the SEC.Itis effectiveimmediately. The policy can be found on The Insider at:http://intranet.sec.gov/ policies_procedures/ admin_regulations/ r3-2.pdf.TCRs can be conveyed through a variety of means, including bye-mail, phone, ordirect conversation. Every member of the SEC staff has the potential to receive aTCR. Accordingly, it is imperative that the agency have a uniform and timelysystem of collection. This policy helps to ensure that the information being receivedcan be evaluated in the best manner. In conjunction with this policy, an interimsystem for storing the information collected also has been established.Each staff member has the responsibility to record or transfer to a deslqnatedperson/group, as detailed in the regulation, any information which they receivethrough a TCR. Absent extenuating circumstances, any transfer of information forrecordation must occur within one business day of receiving a TCR, andinformation is to be recorded within three business days of its receipt and/ortransfer.You are urged to read the regulation in full so as to familiarize yourself with theintake process for your respective Division or Office. All Divisions .and Officesshould disseminate their intake process and their desiqnated intake staff. Pleasecheck with your immediate supervisor should you have any questions regardingthe policy.

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