Jury’s Verdict Shows SEC Should Stop Scapegoating Junior Employees and Go After Corporations and Executives Who Break the Law

Washington DC, July 31st, 2012- “The message from this jury’s verdict is clear:  until the SEC starts bringing cases against the real corporate wrongdoers and their executives, juries aren’t going to allow the SEC to scapegoat junior employees,” said Dennis Kelleher, President and CEO of Better Markets, an organization that promotes the public interest in the financial markets.

“The SEC charged a single mid-level employee for all of Citigroup’s derivatives misconduct leading up to the financial crisis.  It did not charge any of the dozens if not hundreds of other involved employees, officers and executives.  The SEC also let the corporation, Citigroup, off by settling with it for a puny penalty that was so small as to be irrelevant to Citigroup,” said Mr. Kelleher.

“The jury obviously saw the unfairness in this highly selective enforcement of the law.  This shows that the SEC’s practice of letting corporations and executives off without any meaningful penalties is fundamentally flawed.  Mr. Stoker was one of dozens of Citigroup employees packaging and selling the $1 billion derivative, which Citigroup itself shorted and bet against.  The SEC’s practice of chasing minnows while letting the whales go must change if Wall Street’s pattern of breaking the law is to be stopped,” said Mr. Kelleher.

Better Markets objected to the paltry sweetheart settlement between the SEC and Citigroup in the Federal District Court last fall and will be filing its objections in the pending appeal of that settlement shortly.                                                                        

About Better Markets

Better Markets is a nonprofit, nonpartisan organization that promotes the public interest in financial reform in the domestic and global capital and commodity markets. Better Markets advocates for transparency, oversight and accountability with the goal of a stronger, safer financial system that is less prone to crisis and failure thereby eliminating or minimizing the need for more taxpayer funded bailouts.