SEC Toughens Enforcement Efforts

In this file photo made Dec. 17, 2008, shows the exterior of the Securities and Exchange Commission (SEC) headquarters in Washington. Federal regulators filed civil fraud charges against an investment adviser and his firm in connection with complex securities tied to mortgages during the housing market bust. (AP Photo/File
AP Photo/File
The Securities and Exchange Commission's chief enforcement official says the agency has toughened its efforts to shut down financial misconduct after failing to act quickly in the cases of R. Allen Stanford and Bernard Madoff.

SEC Enforcement Director Robert Khuzami says in testimony prepared for a Senate hearing that "we have moved aggressively" to put in place reforms recommended by the SEC inspector general. The IG found that the SEC knew since 1997 that Stanford likely was operating a Ponzi scheme but waited 12 years to bring fraud charges against the billionaire.

Khuzami also tells the Senate Banking Committee the SEC is working to provide "maximum recovery" to investors hurt in Stanford's alleged $7 billion fraud.