Former SEC lawyer defends agency work despite Madoff connections

Becker, who left the agency Friday for unrelated reasons, was responding to a series of questions posed by top Republicans on the House Financial Services Committee, who sent a letter listing their concerns to SEC Chairwoman Mary Schapiro Thursday.

Questions surrounding Becker and Madoff emerged after it was revealed that Becker and his brothers inherited roughly $1.5 million from an account that was once invested with Madoff by their mother, who died in 2004. The connection was revealed when the trustee charged with recovering funds lost in the Madoff scheme filed suit against Becker in bankruptcy court, in an effort to claw back fraudulent earnings.

Becker, who served as the SEC's general counsel from 1998 to 2002, said that when he returned to the same position in 2009, he informed Schapiro and the SEC's ethics counsel of the connection. He added that his mother's account was liquidated years before Madoff confessed to the Ponzi scheme.


He said the SEC informed him that he did not have to recuse himself from any future Madoff work, as the enforcement actions being pursued would not have a "direct and predictable effect" on his personal finances.

"The Ethics Counsel also concluded that a reasonable person with knowledge of all these facts would not question my impartiality," he wrote.

However, he acknowledged that "it appears that no one specifically considered" whether the public should be notified of the connection. He had filed the disclosure forms required of public officials, but said nothing on those forms required the mentioning of his mother's account.