Ex-SEC Top Lawyer Denies Claims He Had Conflict in Madoff Case

David Becker, the former U.S. Securities and Exchange Commission general counsel accused of violating conflict of interest laws, said he had “no financial interest” in the agency’s position on how Bernard Madoff’s fraud victims should be compensated.

Becker, who stepped down in February, made the statement in remarks prepared for a U.S. House hearing called to review his participation in SEC policy related to the Madoff case after inheriting money tied to the Ponzi scheme.

Tomorrow’s hearing will come two days after SEC Inspector General H. David Kotz released a review of Becker’s role and said he would ask U.S. prosecutors to determine whether Becker should face criminal charges for helping to make policy when he had a financial interest in the outcome.

“It was in my best interest and the commission’s for me to follow the law wherever it led,” Becker wrote in explaining his decision to seek and follow the SEC ethics officer’s advice on whether the inheritance presented a conflict. “I had neither the desire nor reason to skate close to the line.”

Becker, Kotz and SEC Chairman Mary Schapiro are scheduled to testify in a hearing before the committee tomorrow.

In response to accusations he acted in his own financial interest, Becker said he took a 90 percent pay cut to return to the SEC and “forfeited millions of dollars to serve my country,” according to the testimony. Becker said his only relationship with Madoff “is that in 1995 he defrauded my then 85-year-old father.”

To contact the reporters on this story: Joshua Gallu in Washington at jgallu@bloomberg.net; Robert Schmidt in Washington at rschmidt5@bloomberg.net

To contact the editor responsible for this story: Lawrence Roberts at lroberts13@bloomberg.net

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