The source said that one associate director in the enforcement division had in recent days ordered junior staff to review every case that’s been closed over the last few years, to ensure that violations weren’t missed — as they appear to have been in the 2006 investigation of Madoff. “There’s a real paranoia around here,” the source added.
That paranoia — or at least extreme concern — apparently extends to commission officials in Washington. The source said that since the Madoff allegations came to light last week, SEC brass had sent out numerous emails warning staffers not to destroy documents relating to the case.
Emails “warning staffers not to destroy documents” is, of course, the functional equivalent of Frank Quattrone’s infamous admonition that “Now would be a good time to clean up your files” or similar. Why else would the staff of one of the nation’s most important, if FUBAR, law enforcement agencies need numerous emails on the subject?