Key SEC official in Madoff inquiry resigns

WASHINGTON, July 9 (UPI) -- A senior U.S. Securities and Exchange Commission official who oversaw key investigations of Bernard L. Madoff's activities is resigning, the agency said.

Lori Richards is stepping down after 14 years as director of the Office of Compliance Inspections and Examinations, The Washington Post reported.

The agency had come under scrutiny for its role in the SEC's monitoring of Madoff's business without detecting his multibillion-dollar fraud. Her office reviewed his firm at least three times, in 1999, 2004 and 2005.

In response to lawmakers' questions about Madoff, Richards told Congress her office doesn't have the resources to keep up with the growing needs for oversight.

With Richards' departure, scheduled for Aug. 7, SEC Chairman Mary Schapiro will soon have installed her own people in nearly all the top positions at the embattled agency, reports said.

With a staff of more than 700, the Office of Compliance Inspections and Examinations is responsible for ensuring brokers, investment advisers and mutual funds comply with securities laws.

Demands on the office are expected to grow. The Obama administration has proposed the SEC begin examining hedge, private-equity and venture capital funds.