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It Burns! It Burns!

We don't know what line Vegas had on Linda Thomsen keeping her job, but even before the SEC was Marked-to-Markopolos this week, it was a pretty good bet that the Head of Ennuiforcement, 6 years shy of her 20, was unlikely to be collecting a government pension of any note. The Post confirms it with an unconfirmed rumor that there is a lot of light and noise emanating from the Mary Schapiro set to this general end.

Newly installed SEC boss Mary Schapiro is quietly searching to replace Linda Thomsen, the agency's embattled enforcement chief, with a prosecutor's Street cred, according to people familiar with the situation.
Sources said Schapiro is scoping out the ranks of professionals in various offices of the US attorney, who litigate cases on behalf of the US government under the direction of the attorney general.

Well, it certainly wasn't quiet, but that's no surprise. The surprise would be if the SEC hadn't leaked it themselves to try to take a little bit of the Class O star level heat coursing out of the beltway off of themselves. Unfortunately, at this point there isn't an SPF number obviously high enough to keep even the Alaska office agents from getting a nice, deep Mozilo.
We're also not so sure that the "ranks of professionals in various offices of the US attorney" is the best place to look. Sarasota might give white collar prosecution a better name at this point.
Looking ahead, what's the Vegas line on Schapiro? Selected, as she was, before it was obvious to the entire planet how useless the SEC is, how likely are the attributes that commended her to the position to seem useful now? What say you, Dealbreaker?
SEC's Blind Spot [The New York Post]


SEC Burns Whistleblower In The Most SEC Way Possible

In recent years, the Securities and Exchange Commission has had its share a fuck-ups come to light. The regulator took a pass on heeding the warning signals by Bernie Madoff himself that he was running a Ponzi scheme, it chose to go after David Einhorn rather than Allied Capital when the hedge fund manager suggested all was not right at the company, and yesterday, it was announced that the Commission is suing Egan-Jones for lying about having rated 150 ABS bonds on an SEC application four years ago (in reality it had rated zero), information that could have been fact-checked at the time but was not because there were new clips on,, and to watch. Today the team scored a new victory when it outed an informant. Federal securities regulators, in a sensitive breach, inadvertently revealed the identity of a whistleblower during a probe of a firm that ran a stock trading platform. The gaffe by the Securities and Exchange Commission occurred during an investigation of Pipeline Trading Systems LLC when an SEC lawyer showed an executive who was being questioned a notebook from the whistleblower filled with jottings about trades, calls and meetings. The executive says he recognized the handwriting. Pipeline, which didn't admit or deny the allegations, was the subject of a page-one Wall Street Journal article earlier this month. The article didn't name the whistleblower, but he has now agreed to be publicly identified. He is Peter C. Earle, 41, a former employee of a Pipeline trading affiliate. Mr. Earle said he was "disappointed" the SEC took steps in its probe that ended up disclosing his identity to Pipeline. The SEC confirmed showing the notebook to an executive of the business it was investigating. SEC officials said there is always a risk a whistleblower's identity might be disclosed during an investigation, but its practice has been to avoid unnecessarily revealing an informant's identity. The person shown the notebook (in a November 2010 SEC interview), Gordon Henderson, was the head of Pipeline's trading affiliate, Milstream Strategy Group. He said in an interview that he previously suspected Mr. Earle was an SEC informant. Mr. Henderson's desk was near Mr. Earle's in Milstream's New York office, and he said he recognized Mr. Earle's handwriting in the notebook. Related: "Mr. Earle said he made other internal complaints about trading, and was fired on April 3, 2009. Mr. Henderson said the reasons for dismissal included poor performance and a belief Mr. Earle was having an affair with the wife of another Milstream trader at the time. Mr. Earle denied both allegations, calling the notion of poor performance 'ridiculous.'" Source's Cover Blown By SEC [SEC]