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Political Economy
Posted at 08:44 PM ET, 05/09/2011

David Becker, former SEC official with Madoff problem, rejoins law firm

Former SEC general counsel David M. Becker, whose departure from the agency earlier this year was clouded by questions about his inheritance of an account with Bernard Madoff, has returned to his former law firm, Cleary Gottlieb Steen & Hamilton.

“I look forward to contributing what insights and experience I can for the benefit of our clients and Cleary Gottlieb,” Becker said in an announcement posted by the firm.

For Becker, it was another spin through Washington’s revolving door. He served as general counsel at the Securities and Exchange Commission about a decade ago and moved from the SEC to Cleary Gottlieb. He left his position as a partner at Cleary Gottlieb in 2009 to return to his old job at the SEC.

He became a top adviser to SEC Chairman Mary L. Schapiro. But, in March, when a congressional panel was probing whether the SEC ignored potential conflicts of interest when it allowed Becker to help shape agency policy toward victims of Madoff’s Ponzi scheme, Schapiro cast him in a less than flattering light.

“Do I wish now that he had been more sensitive to the potential of this issue to raise an appearance of a conflict? Yes, I wish it hadn’t happened,” Shapiro said.

“I wish that Mr. Becker had recused himself, absolutely,” she added.

When Becker’s mother died years ago, Becker and his brothers inherited a $2 million investment account with Madoff, which they liquidated. In December, as part of a broader effort to recoup funds for people who lost money in Madoff’s fraud, the trustee overseeing the Madoff bankruptcy sued Becker and his brothers to “claw back” $1.5 million on the theory that most of their payout was made with other investors’ money.

In a written response to questions from House members, Becker said he told Schapiro about the Madoff account about the time he rejoined the SEC in 2009.

He consulted and obtained a green light from the SEC’s ethics counsel to participate in matters affecting Madoff investors.

The subject is under review by the SEC’s inspector general.

“We are very pleased to welcome David back to the firm,” Cleary Gottlieb managing partner Mark Leddy said in the law firm’s announcement Monday.

By  |  08:44 PM ET, 05/09/2011

 
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