DAVID VITTER wasumeron, 0. United States Senate eo tn Baton Rouse icc Wap WASHINGTON, Dc 20510 September 3, 2010 Mary Schapiro Chairwoman Securities and Exchange Commission 100 F Street, NE. Washington, D.C. 20549 Dear Chairwoman Schapiro, On October 7, 2009, Senator Shelby and I wrote to request a more complete examination of the handling of the investigation of Robert Allen Stanford’s various ‘companies. The inspector general’s report made clear that the SEC’s examination office had been aware since 1997 that Stanford was likely operating a Ponzi scheme. Over a period of eight years, the SEC’s Fort Worth Examination group conducted four examinations of Stanford’s examinations - in 1997, 1998, 2002 and 2004. In each instance, it was revealed that the certificates of deposit (CDs) sold by the Stanford bank in Antigua could not have been “legitimate,” and that it was “highly unlikely” that the returns could have been achieved with the conservative investment approach that was being advertised. Yet, it wasn’t until 2009 that the SEC acted on these concems. Unfortunately, in the months that have followed, this report has not received the attention that it deserves and it is unclear what changes have been made at the SEC as a result. To date, it appears that as chairwoman you have only publicly addressed the contents of this report once, on the day it was released. I would like for you to revisit the inspector general’s report, and request a detailed account of the changes made at the SEC since the issuing of the report and the discrepancies between the report and the testimony ofa SEC official at a U.S. Senate Banking Committee hearing on the subject in August 2009. Further, I am requesting a formal meeting with you to discuss these matters as soon as possible, ‘The IG report also seems to directly contradict testimony that Ms. Rose Romero, of the SEC’s Dallas-Fort Worth Office, gave at a U.S. Senate Banking Committee hearing last August. I asked Ms. Romero, very directly, when the SEC formally began an investigation of Stanford Group, and what exactly provoked the initial investigation. In her testimony, Ms. Romero claimed that an informal investigation into Mr. Stanford’s activities began in 2004 and a formal investigation occurred at the end of 2005 or beginning of 2006. When her response is compared to the inspector general's report, itis, either severely ill-informed or deliberately misleading. How do you explain the discrepancy between the inspector general's report, which clearly shows that that the AEABIANA, CENTRAL LOUISIANA NONTHEASTLOUISIANA NORTHWEST LOUISIANA SOUTHEAST LOUISIANA. SOUTHWEST LOUISIANASEC had been investigating Stanford's activities much, much earlier than 2005 and had merely decided not to take any enforcement action? The flaws that the IG report highlights seem to be deeply engrained in the fabric of the SEC and it seems unlikely that changes that have been made prior to the release of the report would adequately address the problem. Therefore, I respectfully request a full and detailed analysis of any and all changes that have been made at the SEC as a result of the inspector general’s report both in D.C. and at the Fort Worth office specifically. Which of the report’s recommendations have the SEC implemented? Which of the report's recommendations have the SEC chosen not to implement and why? Additionally, the timing of the release of the IG’s report was also highly suspicious in that it was released the same day that the SEC announced it was filing charges against Goldman Sachs, saying only that the report concerned past events and most of the report’s implementations had been implemented since 2005. [tis unclear to me whether the SEC has truly undergone the fundamental changes necessary, or if the SEC has simply refined its ability to deflect attention with incomplete or misleading testimony and use other events to distract from the main issue. If you have any questions or require any additional information, please contact Travis Johnson in my office and Kathryn Fulton will be happy to schedule a time for us to meet (202-224-4623). I look forward discussing these issues further. Sincerely, United States Senator