Former Senior Associate Chief Accountant Settles SEC Charges for Conflict of Interest

A former SEC senior associate chief accountant agreed to pay $40,000 in order to settle SEC charges for violating post-employment conflict of interest restrictions.

The SEC alleged that Edmund W. Bailey failed to notify the SEC that he intended to provided an expert report in defense of an audit firm (the "Firm"), which was under investigation by the SEC. The investigation had been opened by the SEC's Boston Regional Office ("BRO") concerning possible violations of auditor independence requirements by the Firm. Specifically, the BRO was reviewing the Firm's practice of loaning staff to its audit clients to perform tax work. The BRO investigation was also pending under Mr. Bailey’s "official responsibility" because accountants working under him participated in the matter. Shortly after retiring from the SEC, Mr. Bailey allegedly agreed to write an expert report for the Firm. In the draft referenced in the Order, Mr. Bailey defended the Firm's practices and made reference to his experience at the SEC. The SEC also alleges that Mr. Bailey knew the report would be submitted to the SEC but did not notify the SEC.

A parallel case was filed by the DOJ against Mr. Bailey was settled in U.S. District Court for the Eastern District of Texas.