FL financial regulator resigns

[Demosthenes]

Florida's financial regulator latest to resign
By Bruce Kelly
August 21, 2008

For the second time this year, a top state securities regulator has resigned under a cloud, according to published reports.
A week ago Tuesday, Florida’s commissioner of the Office of Financial Regulation, Don Saxon, said he was stepping down at the end of next month.
He leaves amid allegations that his agency let thousands of convicted criminals work in the mortgage business, including bank robbers and racketeers, according to the Miami Herald.
Mr. Saxon’s office also regulates the state’s securities, banking and insurance businesses.
He is not the only top securities cop to be shown the door this year.
In February, Wayne Klein resigned as director of Utah’s Division of Securities.
A few months earlier, a Utah state representative asked the legislative auditor general’s office to audit Mr. Klein’s division.
There has been at least one other recent change of a top securities regulator: Last August, G. Brent Bishop was fired as Ohio’s commissioner of the Division of Securities.
Mr. Saxon and Mr. Bishop both faced pressure after local newspapers analyzed records of brokers selling financial service products or mortgages.
In July, The Miami Herald found that more than 10,000 people with criminal records were allowed to work in Florida’s mortgage industry from 2000 to 2007.
The paper also found that convicted felons had stolen at least $85 million from lenders and consumers.
And in May 2007, The Columbus Dispatch reported that state officials had not been checking regular updates of brokers’ records from NASD – now the Financial Industry Regulatory Authority Inc. of New York and Washington – from 2000 to 2005.
That meant that regulators had disregarded thousands of potential warning signs of brokers’ irregular or illegal practices.
For the full report, see the upcoming Aug. 25 issue of InvestmentNews.

[Judge Roy Bean]

They not only let thousands of people with questionable records work in the origination side, they don't even have to look at the people operating in the servicing end.