Did the SEC overlook Lehman insider trading?

[deminks]

http://www.americablog.com/2009/02/did-sec-overlook-lehman-insider-trading.html

But remember, self-regulation is the cure for all problems as the Republicans always like to tell us. If you figure out what the heck that means in a case like this, please let me know. Maybe Senator Grassley, who is now hot on the trail of failed regulation, can brief us on how his party has helped address problems such as this over the years.

The insider trading allegations, and more than 4,000 e-mail messages relating to them, were presented to Linda Thomsen, the former director of enforcement at the S.E.C. last April by Ted Parmigiani, a former analyst at Lehman who followed the semiconductor industry. According to Mr. Grassley’s letter, Mr. Parmigiani spoke with high-level enforcement officials several times both on the phone and in person. An in-person meeting on April 30, 2008, lasted for six hours, the letter said.

Mr. Parmigiani, who was dismissed by the firm in June 2005 for what it said were performance issues, declined to comment. John Nester, a spokesman for the S.E.C., said he would not discuss whether Ms. Schapiro had responded to Mr. Grassley’s letter or the allegations made by the former analyst. But he said in a statement: “We certainly share the senator’s interest in vigorous enforcement against illegal insider trading.”

Link to NYT article from 2/22/09.

http://www.nytimes.com/2009/02/23/business/23hedge.html

In a letter sent to the commission last Thursday, Charles E. Grassley, the Iowa Republican who is the ranking member of the Senate Finance Committee, asked Mary L. Schapiro, the chairwoman of the S.E.C., whether it had followed up on allegations that were brought to its attention last spring involving a unit at Lehman Brothers. Employees in the unit, known as the Product Management Group, appear to have tipped off clients and traders about the content of the firm’s research reports before they were released, a former Lehman analyst said.

The letter does not disclose who might have received the tips, if they were made.

The insider trading allegations, and more than 4,000 e-mail messages relating to them, were presented to Linda Thomsen, the former director of enforcement at the S.E.C. last April by Ted Parmigiani, a former analyst at Lehman who followed the semiconductor industry. According to Mr. Grassley’s letter, Mr. Parmigiani spoke with high-level enforcement officials several times both on the phone and in person. An in-person meeting on April 30, 2008, lasted for six hours, the letter said.

(end snips)

I hadn't seen this posted yet. As Rep. Dennis Kucinich is asking, who asked the SEC to stand down? For Lehman, for Madoff, for Stanford, for a zillion others.