Judge Rakoff does not approve of SEC practices

At the beginning of the month I wrote about the SEC's settlement of still another dispute with Citicorp. I asked the question of whether the SEC was in bed with them. Apparently, Judge Jed Rakoff felt they were, as he threw out the settlement as being “neither fair, nor reasonable, nor adequate, nor in the public interest” because it does not provide the court with evidence on which to judge the settlement. The judge felt that the policy "asks the court to employ its power and assert its authority when it does not know the facts.”

And, he goes on, “In any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth.” The S.E.C. in particular, he added, “has a duty, inherent in its statutory mission, to see that the truth emerges.”