Compliancex

More information has come to light regarding the allegations of sexual misconduct at the Securities and Exchange commission.

Last week, the SEC “ordered an independent inquiry into allegations of sexual misconduct by current and former staff working for its office of the inspector general,” according the Wall Street Journal. The misconduct allegedly took place during the period in which David Kotz served as Inspector General for the SEC. Precedent suggests that the agency would review the complaint internally, by the inspector general. But the SEC in this case chose to employ an outside investigator to avoid a “conflict of interest,” according to the Wall Street Journal.

What was the “conflict of interest”? It turned out that one of the staff members who filed the complaint was David Weber, the new lead investigator at the Securities and Exchange Commission. And several days after that story emerged, it was revealed that Weber had been placed on a temporary administrative leave due to staff complaints that he was a physical threat. Weber had allegedly expressed a desire to wear a bulletproof vest and carry a concealed firearm at the office.

Now, a probe is seeking to determine whether the alleged misconduct impeded the SEC’s ability to catch white collar criminals Allen Stanford and Bernie Madoff, according to Bloomberg.

The SEC is currently seeking another individual with no conflicts of interest to temporary run the office of inspector general.  Until that time, the deputy inspector general, Noelle Maloney, has been filling the role.

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Beth Connolly is Editor-in-Chief of the Wall Street Job Report and the Compliance Exchange. She blogs creatively at When Nutmeg Met Basil. Connect with her on LinkedIn , Twitter, and About.Me.