Here is a thoughtful piece by Joe Carson.  Enjoy…

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SEC dysfunction follows meltdown in legal ethics at US Office of Special Counsel

February 6, 2009

Mr. Philip Michael
Troutman Sanders
Attorney for Harry Markopolos
NY, NY
<philip.michael@ troutmansanders. com>

Ms. Gaytri Kachroo
McCarter and English
Attorney for Harry Markopolos
Boston, MA
<gkachroo@mccarter. com>

Attention: Harry Markopolos

Subject: US Office of Special Counsel (OSC) lawbreaking and SEC’s dysfunction

Dear Mr. Markopolos,

I read your written statement and watched an archive of Wednesday’s
Congressional hearing, available at
<http://www.house. gov/apps/ list/hearing/ financialsvcs_ dem/hr020409. shtml>.
We have similarities in putting the public good before our private
interest in defending our respective professions, their codes of
ethics, and the public good. We are also both extremely tenacious
and not without cunning.

But, your analysis of what is wrong and why at SEC is incomplete,
therefore your prescription to correct it is
inadequate. Why? Employees at SEC, as other federal agencies, are
to comply with the “merit principles” of the federal civil service in
the performance of their duties (see 5 USC 2301). They did not do so
in dealing with your disclosures about Madoff, which is why you
experienced so much dysfunctionality.

Why not? The reason is because they have no viable protection from
SEC’s violations of those merit principles against them (technically
called “prohibited personnel practices (PPP’s),” listed at 5 USC
2302). SEC employees have to walk around their offices, finger in
the wind and hands on their wallets asking “is it safe for me and my
career to do my duty in this situation?” That is the reality of
working at SEC C(as other gov’t agencies).

Why do they have no viable protection? Because the federal law
enforcement agency specifically created to enforce the laws to
protect federal employees from such agency lawbreaking – the US
Office of Special Counsel (OSC) – is a 30 year lawbreaking failure,
corrupt and corrupting. It was created to be the immune system of
the federal civil service, because it is so corrupt it allows
corruption and dysfunction to take root and flourish in many federal
workplaces, such as SEC.
Why has OSC’s lawbreaking gone on for so long? Follow the money,
lots of people and special interests benefit from it, making them
“willfully blind” to it, just like the Madoff feeder funds.

Your testimony specifically called for protection for Ed Manion from
SEC reprisal, so he could testify to Congress. Well, OSC is the
federal law enforcement agency responsible to protect federal
employees from agency reprisal for testifying to Congress.

Your prescription for reforming SEC presumes SEC employees, with
adequate training, tools, and professional credentials, could and
would then do their jobs without fear or favor, ethically and
competently to protect the investor. That prescription is based a
false presumption.

OSC’s lawbreaking failure to protect SEC (as other federal employees)
from agency lawbreaking, taken to punish federal employees who put
the public interest before the private interests of their managers,
invalidates your prescription. Nothing would necessarily change at
SEC if it followed your prescription – Ed Manion (and Mike Garrity)
is proof of that. He has the experience, training, and professional
credentials. He knew Madoff was a fraudster. He knew you were being
blown off by SEC attorneys. So Why did he not go to SEC IG? Why did
he not go to OSC (via its protected disclosure channel, per 5 USC
1213)? Why did he not go to Congress? Why did he not go to
media? You know as well as I – he was afraid of SEC reprisal, and
rightfully so, a result of OSC’s long-standing systemic lawbreaking
and corruption.

Why has OSC been so corrupt for so long? Because another
self-regulating entity – the legal profession – “looks other way” at
significant deficiencies in scope and implementation of legal ethics
for government attorneys. Want proof? It seems to me that your
attorneys should be advising you to file professional ethics
complaints against the SEC attorneys who were derelict in their duty
in not pursuing your allegations. But I doubt they will do so. Why
not? They likely cite some obscure aspect of legal ethics – you
know, its “code of silence” – about attorneys not blowing whistles on
other attorneys’ professional malfeasance, regardless of how it has
harmed people like you. After all, SEC attorney malfeasance results
in your hiring them in the first place.

By law (5 USC 1201 statutory note, citing the Federal Whistleblower
Protection Act of 1989), OSC is mandated to “act in the interests” of
the federal employees who seek its protection from agency lawbreaking
against them. It is small, about 110 employees, of whom half are
attorneys. These attorneys are “caseworker” attorneys, they do not
have an attorney-client relationship with the federal employees they
are responsible to protect from agency lawbreaking. That means they
consider OSC to be their client. Since legal ethics is focused on
“holding paramount” the interests of the attorney’s client, these OSC
attorneys reason that since they are not implementing the law they
are responsible to implement, their primary professional duty as
attorneys is to cover-up their and OSC’s lawbreaking. And the legal
profession says “that’s right.”

Bottom line, the legal profession says “free pass” to government
attorneys who betray their oaths as attorneys and federal employees
in not executing the laws they are responsible to implement – at SEC,
OSC and elsewhere. Until that is fixed, passing laws to make such
agencies do their jobs is futile – the responsible attorneys can
continue to thumb their noses at those laws and the legal profession
will continue to say “free pass.”

If only one of the responsible attorneys at SEC for blowing you off
was disciplined, in any way, by the legal profession, SEC would
change, overnight, forever. No one like you would ever be blown off
again – the responsible SEC attorneys would know they could be held
professionally accountable as attorneys, instead of being promoted
and protected for being their SEC attorney fraudsters as Linda Thompson.

I appreciate and respect your courage and self-sacrifice. I’m former
military too – a nuclear submarine officer for 6 years. By dint of
16 years of defending and upholding my profession of engineering, its
code of ethics, and the public health and safety, I am now an
influential member of mankind’s largest and most global profession of
engineering, whose 20 million degreed members worldwide collectively
hold civilization and much of the natural environment in their
hands. But until legal ethics for government attorneys is cleaned
up, engineering ethics will always be imperiled. Ditto professional
ethics for financial professionals.

Respectfully,

Joe Carson, PE
“multiple-time” prevailing government whistleblower <www.carsonversusdo e.com>
Chair, OSC Watch <www.oscwatch. org>
President, Affiliation of Christian Engineers <www.christianengin eer.org>
Chair, Vols4STEM Steering Committee <www.Vols4STEM. org>
and a political spouse! <www.carson08. com>

 

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