In response to questions from the Senate banking committee regarding the Securities and Exchange Commission's failure to pick up on Bernard Madoff's malfeasance after 10 years of clues, the commission's enforcement director, Linda Thomsen, says the SEC doesn't have pockets deep enough to follow every lead it gets on possible misconduct.
According to Bloomberg.com:
In prepared remarks, Thomsen said SEC investigators receive hundreds of thousands of tips every year, and the enforcement division's 1,000 employees use "triage" to pursue the most promising leads. In an earlier draft obtained by Bloomberg, Thomsen said the SEC uses "virtually all our resources to pursue fires," and that more resources would enable it to find "smoke."
In addition to requesting more funds, Thomsen also suggested an overhaul of investment adviser and brokerage oversight, including requiring advisers to engage third parties to hold client assets.
Given that new SEC head Mary Schapiro is known for being tough, the overhaul is most likely on its way. More money, on the other hand, may not be so easy to come by in the current economic climate.