US for deeper regulator pockets, more sleuths to fight frauds

WASHINGTON: In its war on financial frauds, the Barack Obama administration has proposed a billion-dollar pocket for the stock market regulator, besides more funds and personnel for other regulatory agencies such as the FBI.

Allocating a $ 26.5-billion budget for the Department of Justice, the government said this includes "resources for combating financial fraud and protecting the public interest".

"The budget provides resources for additional FBI agents to investigate mortgage fraud and white-collar crime and for additional federal prosecutors, civil litigators and bankruptcy attorneys to protect investors, the market, the federal government's investment of resources in the financial crisis and the American public."

The Office of Management and Budget said the new administration proposes to change "the way Washington does business" from its earlier practice when there was "a high tolerance" for issues like fraud.

The US has been rocked by many cases of fraud in the recent past, including the estimated $ 50-billion Madoff scam.

Noting that in the past year "the consequences of poor market oversight became abundantly clear," it said, the budget will increase the resources for the Securities and Exchange Commission (SEC) by over 13 per cent and the Commodity Futures Trading Commission (CFTC) by over 44 per cent relative to 2008 levels.