(Bloomberg) -- A trial attorney from the SEC said his bosses were too “tentative and fearful” to bring many Wall Streetleaders to heel after the 2008 credit crisis, echoing the regulator’s outside critics.
James Kidney, who joined the SEC in 1986 and retired this month, offered the critique in a speech at his goodbye party. His remarks hit home with many in the crowd of SEC lawyers and alumni thanks to a part of his resume not publicly known: He had campaigned internally to bring charges against more executives in the agency’s 2010 case against Goldman Sachs Group.
The SEC has become “an agency that polices the broken windows on the street level and rarely goes to the penthouse floors,” Kidney said, according to a copy of his remarks obtained by Bloomberg News. “On the rare occasions when enforcement does go to the penthouse, good manners are paramount. Tough enforcement, risky enforcement, is subject to extensive negotiation and weakening.”
Kidney said his superiors were more focused on getting high-paying jobs after their government service than on bringing difficult cases. The agency’s penalties, Kidney said, have become “at most a tollbooth on the bankster turnpike.”
His March 27 remarks drew applause from the crowd of about 70 people, according to witnesses. In an interview, Kidney said he hadn’t heard any blowback from SEC officials.
SEC spokesman John Nester declined to comment.
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