WASHINGTON, Sept. 20 (UPI) — The Securities and Exchange Commission’s inspector general is referring a possible conflict of interest case to the U.S. Justice Department, a report said.
The case involves SEC general counsel David Becker, who helped with decisions on how much victims of Bernard Madoff’s massive Ponzi scheme could recover, The New York Times reported Tuesday.
Becker, however, was also a beneficiary, who, along with his brothers, inherited his family’s account with Madoff Investment Securities, the company that was the front for Madoff’s massive fraud.
Becker and his brothers closed the account with Madoff in 2004. But he is still being sued by the court appointed trustee in the case, Irving Picard, as his family gained $1.5 million from their investments with Madoff’s firm.
The case is likely to be under scrutiny on Capitol Hill. Becker and SEC Chairwoman Mary Schapiro are scheduled to testify Thursday at a joint hearing of the House Financial Services Committee and the Committee on Oversight and Government Reform.
SEC Inspector General H. David Kotz is also scheduled to appear at the hearing.
Kotz’s report says he discussed the issue with the Office of Government Ethics, which advised him to refer the case to the Justice Department.
Schapiro said in a statement the SEC will retake a critical vote on the matter of victim compensation in the Madoff case. She also said, “I do want to state that I’ve known David for many years to be a talented, highly skilled lawyer and a dedicated civil servant who served under three chairmen.”