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No Pay or Staffing Increases in SEC Budget

Bush Administration says staffing levels are adequate

By John M. Baker, Esq.

The Bush Administration has an important message for would-be fraudsters in the wake of the Enron scandal: Existing levels of securities regulation and enforcement are just fine. The proposed Securities and Exchange Commission budget for fiscal year 2003 (which runs from October 1, 2002, to September 30, 2003) provides for level staffing across the board and no new initiatives, other than a $4 million e-government initiative and some security preparedness and telecommunication upgrades. The SEC base budget would increase by $21 million, or about 5%, with the increase primarily devoted to scheduled pay raises and increased rent expense. The SEC’s recently enacted authority to give its personnel pay parity with the bank regulatory agencies would not be funded.

The SEC has not, at this writing, posted its Fiscal 2003 Budget Estimate, but the Office of Management and Budget’s budget information is available at

For a press report, see

According to the Wall Street Journal, the SEC had scheduled Enron Corporation’s 2000 annual report for review, but the staff did not have sufficient resources and the review was deferred for a year. It has long been clear that SEC resources have lagged far beyond the growth of the securities markets, and there were already concerns that the fiscal year 2001 budget would inhibit the SEC’s ability to keep pace in a number of areas. The Financial Times reported five months ago that the General Accounting Office is conducting a review to determine whether the SEC’s resources are adequate to stay abreast of the market and technological changes that are occurring in domestic and global financial markets. Although the GAO report was said to be due by December 31, 2001, there has been no sign of it since.

For my prior post, see

Copyright 2001, John M. Baker, Esq., Stradley, Ronon, Stevens & Young, LLP, 1220 19th Street, N.W., Suite 700, Washington, DC 20036 – (202) 822-9611- Fax (202) 822-0140 This article was originally posted to the FundLaw List, To subscribe to FundLaw, send a blank e-mail to

Nothing herein is intended as legal or financial advice. The law is different in different jurisdictions, and the facts of a particular matter can change the application of the law. Please consult an attorney or your financial advisor before acting upon the information contained in this article.  



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