When Rep. Chris Cox testified before the Senate Banking Committee about his nomination to head the SEC on Tuesday, he seems to have scooted over the honesty line.
The Foundation for Taxpayer and Consumer Rights called on the Committee to go after a recently revealed series of documents about Cox's involvement in a massive investment scheme and to recall Cox for further questioning to determine whether or not he lied about his involvement to the Committee.
In response to questions about his past involvement in the First Pension investment scam that took unsuspecting small investors for $130 million and subsequent lawsuits, Cox said:
"I did preliminary work on a small SEC-registered public offering...[and] I had the entirety of the complaint dismissed against me, and there was no settlement of the matter either. I prevailed on the claim in the court."
This statement was made under oath and was false in two respects and misleading in its entirety. First, his work with the firm was far more extensive than a mere preliminary draft, according to a recently revealed court filing (download from this page). The filing, which reveals what lawyers uncovered about Cox during discovery, indicates that Cox was deeply involved with the web of companies and executives perpetrating the fraud. Second, it has been reported that Cox was only dropped from the law suit when his law firm - which did settle with scam victims - agreed to accept liability for Cox's actions.
The Senate Banking Committee refused to get tough with Cox and, instead, quietly passed his confirmation on to the full Senate today. So now, the pensions, 401Ks and college education funds of Americans will be put into the hands of an anti-regulation ideologue with a connection to a massive investor swindle. (Take a moment and watch actor Greg Germann [Ally Mcbeal] give a corporate crook's eye view of why this would be good for business.)
Cox will likely become the head of the SEC by tomorrow night... unless at least one Senator stands up and calls for a debate, which would likely force a discussion of Cox's record on the Senate floor and give the public more time to get to know the real Chris Cox.
So who is that Senator that does not want to be blamed for the damage that may be wrought with Cox atop the SEC? If you know her or him, let me know.