SEC Seeks Dismissal of Madoff Victims Negligence Suit

Bloomberg reports:

The U.S. Securities and Exchange Commission asked a judge to throw out a suit by two of Bernard Madoff’s victims who accused the agency of negligently failing to uncover a scheme that wiped out at least $19 billion.

The agency has said it missed at least six opportunities to spot Madoff’s fraud because it assigned inexperienced employees to inquiries and failed to pursue leads. If the case succeeds, the SEC could be exposed to thousands of lawsuits.

The victims, trying to overcome government immunity, cited a law allowing suits over negligence. The Justice Department said yesterday there’s an exception for workers’ discretionary functions such as case staffing and seeking evidence.

“The manner in which the SEC investigates suspected violations of the securities laws is grounded in policy and committed to the SEC’s discretion by Congress,” , Assistant U.S. Attorney Sarah Normand said in the filing in federal court in New York. “Even assuming that the SEC acted negligently in the course of its Madoff investigations, the discretionary function exception would still apply.”

The monopolist who's supposed to protect you doesn't like being held accountable. What good is the SEC??