David P. Weber

David P. Weber
Born David Paul Weber
Alma mater
Occupation Attorney, professor, investigator
Employer Goodwin Weber PLLC; Robert H. Smith School of Business, University of Maryland, College Park
Known for former Assistant Inspector General for the U.S. Securities and Exchange Commission; whistleblower; Professor at University of Maryland; revealed compromise and hacking of U.S. stock exchanges by foreign power(s).
Spouse(s) Julie Goodwin Weber
Website goodwinweberlaw.com/attorneys/david-p-weber/

David Paul Weber is a former Assistant Inspector General for Investigations at the U.S. Securities and Exchange Commission (SEC).[1] Weber was a whistleblower while at the SEC, reporting allegations about foreign espionage against the stock exchanges, and concerning misconduct in the Bernard L. Madoff and R. Allen Stanford Ponzi scheme investigations, the two largest fraud cases in the history of the United States. He was terminated months later for supposedly unrelated reasons.[2][3][4] He sued the SEC, claiming wrongful termination and retaliation against him for coming forward as a whistleblower. In June 2013, the SEC settled with Weber his whistleblower protection and U.S. District Court lawsuits by reinstating him and paying him $580,000, one of the largest federal whistleblower settlements in US history.[5][6] In 2014, author and blogger Larry Doyle named Weber as one of his "top 5 whistleblowers".[7] On July 30, 2015, Weber was recognized by six United States Senators and one member of the House of Representatives at the First Congressional Celebration of National Whistleblower Appreciation Day.[8]

Education

Weber graduated from Utica College of Syracuse University (Criminal Justice; cum laude, 1995), and Syracuse University College of Law (J.D., magna cum laude, 1998).[1][9] He was admitted to the New York State bar in 1999, the District of Columbia Bar in 2000 and the Maryland Bar in 2013.[10][11][12]

Career

Early career

Before and during law school, Weber served as a United States National Park Ranger for the U.S. Department of the Interior at a number of historic and cultural sites, including the Statue of Liberty, Ellis Island and Fort Stanwix National Monuments. After graduation from law school, Weber became a law clerk to a New York United States District Judge, working on criminal and civil cases. When his judge sat by designation on the United States Court of Appeals for the Second Circuit, Weber assisted with criminal and civil appeals in 1998 and 1999.[1][9] Subsequently, Weber was Special Counsel for Enforcement for more than ten years at the Office of the Comptroller of the Currency, at the United States Department of the Treasury.[1][9] He followed that up by practicing as Supervisory Counsel and Chief of Enforcement Unit I for the Federal Deposit Insurance Corporation (FDIC), responsible for overseeing all banking enforcement activities and investigations involving state chartered banks and bank failures for the western half of the United States.[1][9] Weber served as the FDIC's signatory on the $1 billion settlement eliminating the refund anticipation loans product from the nation's banking system.[13]

Securities and Exchange Commission

In January 2012, Weber was promoted to the U.S. Securities and Exchange Commission (SEC) Assistant Inspector General for Investigations at the Office of Inspector General, directing all criminal, civil and administrative investigations into fraud, waste and abuse in SEC programs and operations, and supervising the Office's investigative staff. In this role, he served as the SEC's chief investigator for internal affairs.[1][9] At the end of that same month, H. David Kotz, SEC Inspector General during the previous four years, resigned and returned to the private sector as managing director of Gryphon Strategies.[14] His resignation came in the midst of questions as to his conduct, as then-current and former SEC employees had complained that Kotz initiated investigations without credible evidence and unnecessarily tainted people's reputations.[14][15]

Madoff accusations, cyber compromise, and retaliatory paid leave

In March 2012, Weber alleged improper conduct by Kotz, asserting that Kotz may have had personal relationships that tainted SEC investigations of the Bernard Madoff and R. Allen Stanford Ponzi schemes.[14][16][17][18] Kotz said Weber's accusations were "completely and utterly ludicrous and untrue."[19][20][21] Despite Kotz's protestations, further investigation proved the allegations were indeed true.[22][23]

Weber also reported potential "national security" concerns and "possible espionage" by "foreign nationals" related to a case Weber was investigating that "involved unencrypted computer hard drives that contained sensitive stock exchange information."[23] Nevertheless, in May 2012, Weber was placed on administrative paid leave after fellow staff complained that he purportedly spoke openly about wanting to carry a concealed gun at work, and brought a bullet-proof vest to work.[2][14][17][19][20][24][25][26] He was also banned from entering SEC headquarters.[19] Weber denied those allegations.[27] U.S. Senator Charles Grassley (R-Iowa) sent a letter to SEC Chairman Mary Schapiro, asking for a copy of the "security threat evaluation" on the basis of which Weber was banned from the SEC's offices.[28][29] The SEC refused to provide the supposed threat evaluation against Weber to Congress. Later, it was revealed that the supposed threat evaluation found that Weber was not a threat, and could return to work.[30] The SEC, however, did not return him to work.[30][31]

Williams report

Weber's allegations against Kotz led the SEC to bring in Inspector General David Williams of the U.S. Postal Service to conduct an independent, outside review.[16][23] The 2012 Williams report concluded that Kotz had in fact violated ethics rules by overseeing investigations that involved people with whom Kotz had “personal relationships.”[2][14][16]

In addition, the Williams report looked at separate allegations that Weber had created a hostile work environment at the SEC. It did not find any evidence that Weber's conduct was improper or triggered security concerns.[4][14][18] The report made clear that the allegations of the bullet proof vest were false; the vest belonged to the SEC and was donned as “a joke after Weber’s colleagues placed smiley-face stickers on it.”.[4] SEC OIG staff also previously carried firearms; the USPS OIG report found that without law enforcement and weapons authority, the SEC OIG was unable to protect the rights of witnesses or complainants. The sole discussion of weapons at the SEC was in the context of re-certifying special agents to carry weapons after SEC OIG's certification had lapsed, prior to Weber being hired.[4] The Williams report also documented that the SEC's own supposed threat evaluation of Weber was false, and cleared him to return to work (though it failed to do so).[31] Finally, the Williams report found that Weber’s reports concerning deficient SEC computer security had merit.[4][23]

Whistleblower allegations

Weber claimed the retaliation was intended to reprise against him for revealing misconduct within the SEC in the Madoff and Stanford investigations, perjury by Chairman Mary Schapiro in testimony before the United States Senate and House of Representatives, and to delay the filing of reports to Congress on the gross misconduct of William S. Fagan (Chief of Security Services for the SEC), Jeff Heslop (Chief Operating Officer of the SEC), and Weber's investigation into the SEC for exposing potential vulnerabilities of the NYSE and NASDAQ Stock Exchange.[2]

According to Weber, Heslop was the target of at least two OIG investigations, including whether Heslop had improperly steered work to Booz Allen Hamilton.[2] The House Oversight and Government Reform Committee is probing the allegations. Chairman Darrell Issa noted that Thomson Reuters' report and investigation about the suspicious and wasteful hiring of the Booz Allen consultants were "broadly compatible" with the Weber lawsuit allegations.[2][32]

According to Weber, Fagan was engaged in pay to play schemes in hiring private security contractors, as well as substantial nepotism in the hiring of security staff. Weber also alleged that Fagan engaged in a cover up of multiple sexual assaults of guard staff and a female visitor to the SEC who was assaulted on a late night due to insufficient security at the SEC's Union Station headquarters.[2] Fagan then used the same private security contractor hired under the pay to play scheme to supposedly investigate Weber, a direct conflict of interest.[2] The US Postal Service OIG, in their 2012 report, found that Fagan's misconduct violated a number of laws and regulations, including the Standards of Ethical Conduct for Executive Department employees.[31][33] A subsequent SEC OIG report also found that Fagan engaged in a coverup of sexual assaults and failures to properly screen employees and contractors of the SEC for criminal convictions.[34]

The investigation into the SEC computer security lapses was detailed in an August 30 report by Interim Inspector General Jon Rymer.[35] His report stated that while there were 28 laptops in question, the outside firm conducted forensic testing on "several select laptops" to determine if a breach occurred. In response, NYSE Euronext hired former Homeland Security Secretary Michael Chertoff to make sure sensitive exchange data were not breached after U.S. securities regulators left their computers unencrypted.[36] “Everything was on those laptops,” said one exchange official who spoke on the condition of anonymity. “You could find the system architecture and technology maps of both the New York Stock Exchange and the Nasdaq, information about their key data centers, their emergency plans. It’s virtually everything you need to know if you were a terrorist looking to sabotage the U.S. capital markets. An SEC spokesman confirmed that the security lapses did occur.[37]

Dismissal and lawsuit

Weber worked at the SEC until October 31, 2012, when, months after becoming a whistleblower accusing the SEC of significant misconduct in the Madoff and Stanford investigations, cyber compromise of NASDAQ, as well as SEC's most senior management misconduct, he was fired for supposedly unrelated reasons.[2][17][25][38] He sued the SEC in federal court in Washington, D.C., in November 2012, saying he was wrongfully terminated and retaliated against for trying to investigate misconduct at the SEC and for coming forward as a whistleblower.[2][16][17][25] Less than two weeks after Weber's suits were filed, the Chairman of the SEC resigned, followed in short order by the resignations or firing of each senior management official of the SEC, including Heslop, Fagan, and the SEC's General Counsel, Mark Cahn.[39][40]

Kotz responded to the civil lawsuit saying that: "for some inexplicable reason, my name has been dragged through the mud in the most ludicrous and unbelievable allegations."[27][2] The SEC said it would "vigorously contest" the lawsuit.[41] Yet, the allegations against Kotz were proven to be true, and the SEC did not contest the lawsuit, or even file an answer.[25] Instead of vigorously contesting the lawsuit as promised, in June 2013, the SEC settled the lawsuits with Weber by paying him $580,000, reinstating him from the date of his dismissal, and clearing his personnel and security records.[5][6] Weber purportedly received the third largest federal whistleblower payment in US history.[42] Despite being reinstated, Weber decided not to return to his former position, instead to stay in private practice by "helping others through my growing law and forensic investigations practice."[4] In 2014, blogger Larry Doyle named Weber as one of his "top 5 whistleblowers".[7] On July 30, 2015, Weber was recognized by six United States Senators and one member of the House of Representatives at the First Congressional Celebration of National Whistleblower Appreciation Day.[8]

Post-SEC

As of July 2014, Weber and his wife Julie Goodwin Weber were principals in Goodwin Weber PLLC.[43] In addition to practicing law, Weber is a certified fraud examiner, private investigator,[1][9] and professor at University of Maryland University College, in the fraud and investigations program,[44] as well as the Academic Director of Fraud Management Programs at the Robert H. Smith School of Business.[45] Weber directs the American Bankers Association - Smith School Financial Crimes Management Program,[46] teaches in the Smith online MBA program,[47] MS in accountancy program,[48] and is also teaching undergraduate classes in fraud and ethics.[49] In addition to teaching at the University of Maryland, Weber is a Woodrow Wilson Visiting Fellow of the Council of Independent Colleges.[50]

Until 2016, Weber was an appeals officer for the 70th Regiment Regional Training institute in the Maryland Army National Guard,[51] and a Lieutenant Colonel in the Judge Advocate Corps of the Maryland State Guard.[52] In 2016, Weber also participated in the review of the Panama Papers.[53] In May 2016, Weber was awarded the Distinguished Teaching Award[54] by the Smith School, at the University of Maryland, for undegraduate teaching.[55]

See also

References

  1. 1 2 3 4 5 6 7 "UC grad now with SEC to speak at college". The Observer-Dispatch. January 13, 2012. Retrieved February 17, 2013.
  2. 1 2 3 4 5 6 7 8 9 10 11 Matt Taibbi (November 19, 2012). "SEC Rocked By Lurid Sex-and-Corruption Lawsuit". Rolling Stone. Retrieved February 17, 2013.
  3. ↑ Alex Kane (November 20, 2012). "Matt Taibbi: Lurid Sex and Corruption Scandal at SEC". Alternet. Retrieved February 17, 2013.
  4. 1 2 3 4 5 6 Hicks, Josh (June 12, 2013). "SEC settles whistleblower case with $580,000". The Washington Post. Retrieved June 12, 2013.
  5. 1 2 Schmidt, Robert (June 10, 2013). "SEC Pays $580,000 Over Ex-Investigator's Firing Claims". Bloomberg. Retrieved June 10, 2013.
  6. 1 2 Holzer, Jessica (June 10, 2013). "Accord Reached Over SEC Firing". The Wall Street Journal. Retrieved June 10, 2013.
  7. 1 2 Doyle, Larry (July 31, 2014). "Sense on Cents - Top 5 Whistleblowers". Sense on Cents. Retrieved August 2, 2014.
  8. 1 2 "Senators Honor Whistleblowers at First Congressional Celebration of National Whistleblower Day | Whistleblower Protection Blog". Whistleblower Protection Blog. Retrieved 2015-11-03.
  9. 1 2 3 4 5 6 "Office of Inspector General; Semi-Annual Report to Congress" (PDF). SEC Office of Inspector General. October 1, 2011 – March 31, 2012. Archived from the original (PDF) on August 24, 2012. Retrieved February 17, 2013.
  10. ↑ "David Paul Weber". Justia dot com. Retrieved February 26, 2013.
  11. ↑ "Daivd P Weber". DC Bar. Retrieved May 28, 2013.
  12. ↑ "Client Protection Fund Attorney Listing". Courts.state.md.us. Retrieved 2015-11-17.
  13. ↑ "a50100954ex10_1.htm". sec.gov.
  14. 1 2 3 4 5 6 Robert Schmidt (November 9, 2012). "SEC Fires Investigator Who Alleged Ethics Lapses, Lawyer Says". Business Week. Retrieved February 17, 2013.
  15. ↑ Robert Schmidt, Joshua Gallu (January 19, 2012). "SEC Inspector General Kotz Quits For Private Investigation Firm". Bloomberg Businessweek. Retrieved February 26, 2013.
  16. 1 2 3 4 Schmidt, Robert (January 25, 2013). "SEC Said to Back Hire of U.S. Capitol Police Inspector General". Bloomberg. Retrieved February 17, 2013.
  17. 1 2 3 4 Main, Carla (November 16, 2012). "SEC Sued, MF Global, JPMorgan Suspended: Compliance". Bloomberg. Retrieved February 17, 2013.
  18. 1 2 "David Kotz, Ex-SEC Inspector General, May Have Had Conflicts Of Interest". Huffington Post. October 5, 2012. Retrieved February 17, 2013.
  19. 1 2 3 Bruce Carton (May 16, 2012). "At the SEC, Investigations About Investigators Who Investigate Other Investigators". Compliance Week. Retrieved February 17, 2013.
  20. 1 2 Sarah N. Lynch (May 10, 2012). "David Weber, SEC Investigator, Put On Leave For Wanting To Carry A Concealed Firearm". Huffington Post. Retrieved February 17, 2013.
  21. ↑ "'Sex and corruption rampant in US Securities and Exchange Commission'". Yahoo. November 20, 2012. Retrieved February 17, 2013.
  22. ↑ "NWC - Bio of David P. Weber". National Whistleblowers Center (NWC). Retrieved 20 November 2015.
  23. 1 2 3 4 Rymer, Jon. "SECURITIES AND EXCHANGE COMMISSION OFFICE OF INSPECTOR GENERAL, WASHINGTON, D.C. 20549 – EXECUTIVE MISCONDUCT" (PDF). Retrieved May 28, 2013.
  24. ↑ Gallu, Joshua (October 9, 2012). "SEC Watchdog Cites Report as Proof He's Not a Security Threat". Bloomberg. Retrieved February 17, 2013.
  25. 1 2 3 4 Lynch, Sarah N. (January 25, 2013). "SEC taps criminal investigator as top watchdog". Reuters. Retrieved February 17, 2013.
  26. ↑ Blackden, Richard (May 11, 2012). "Top SEC investigator David Weber 'put on leave over gun comments'". Telegraph. Retrieved February 17, 2013.
  27. 1 2 Sarah N. Lynch (November 15, 2012). "David Weber Lawsuit: Ex-SEC Investigator Accused Of Wanting To Carry A Gun At Work, Suing For $20 Million". Huffingtonpost.com. Retrieved February 10, 2013.
  28. ↑ Robert Schmidt (May 14, 2012). "Senator Presses SEC Over Decision to Put Investigator on Leave". Business Week. Retrieved February 17, 2013.
  29. ↑ Joe Adler (May 17, 2012). "FDICs IG to Take Temporary Control of SECs Watchdog". American Banker. Retrieved February 17, 2013.
  30. 1 2 Lash, Steve (September 2, 2013). "SEC settles with whistleblower-employee for $580K". New England In-House. Retrieved 20 November 2015.
  31. 1 2 3 "Securities and Exchange Commission Office of Inspector General - Excessive Misconduct" (PDF). Muckrock.s3.amazonaws.com. Retrieved 2015-11-17.
  32. ↑ Lynch, Sarah (January 1, 2013). "Exclusive: U.S. House panel probes SEC spending on consultants". Reuters. Retrieved February 24, 2013.
  33. ↑ "U.S. Office of Government Ethics - Employee Standards of Conduct". oge.gov.
  34. ↑ "Watchdog Finds SEC Did Not Properly Vet Contractors - Business News - The Star Online". thestar.com.my.
  35. ↑ Rymer, Jon. "Investigation into Misue of Resources and Violations of Information Technology Security Poilcies within the Division of Trading and Markets" (PDF). US SEC OIG. Retrieved February 25, 2013.
  36. ↑ Reuters (November 16, 2012). "NYSE hires former Homeland Security chief". Chicago Tribune. Retrieved February 24, 2013.
  37. ↑ Charlie Gasparino. "SEC Staffers Took Laptops With Critical Market Info to Hacker Conference". Fox Business.
  38. ↑ "Woodrow Wilson Visiting Fellows; David P. Weber". The Council of Independent Colleges. Retrieved February 17, 2013.
  39. ↑ Morelli, Steve (2012-11-26). "SEC's Schapiro Resigns After Whistleblower Suit". Insurance News Net. Retrieved 2015-11-17.
  40. ↑ "SEC General Counsel to Resign from the SEC - 40 Act Blog". 40actblog.com.
  41. ↑ "Exclusive: U.S. House panel probes SEC spending on consultants - Business News - Reuters.com". reuters.com.
  42. ↑ Brenzel, Kathryn (June 10, 2013). "SEC Settles Ex-Official's Wrongful Termination Suit". Retrieved June 11, 2013.
  43. ↑ "BON - Bio of Julie Goodwin Weber". Business Owners Network. Retrieved 20 November 2015.
  44. ↑ "The Undergraduate School Business Faculty Biographies - David P. Weber, Professor of Accounting". University of Maryland University College. Retrieved November 1, 2015.
  45. ↑ "ABA - Robert H. Smith Financial Crimes Management Program". Retrieved August 26, 2014.
  46. ↑ "Fraud Management Program". www.aba.com. Retrieved 2016-02-02.
  47. ↑ "David P. Weber | Online MBA UMD". onlinemba.umd.edu. Retrieved 2015-10-29.
  48. ↑ "University of Maryland". http://www.rhsmith.umd.edu/programs/executive-education/who-does-it/meet-our-facilitators/david-weber. Retrieved 2016-04-08. External link in |website= (help)
  49. ↑ "University of Maryland". Retrieved 04-08-2016. Check date values in: |access-date= (help)
  50. ↑ "David P. Weber". www.cic.edu. Retrieved 2015-11-01.
  51. ↑ http://www.aba.com/Training/Schools/Pages/FMP-faculty.aspx
  52. ↑ "Financial Crimes Management Program - Faculty List". ABA. 2016-02-02. Retrieved 2015-11-17.
  53. ↑ "SD - Putin's Rich Friends". April 6, 2016. Retrieved April 18, 2016.
  54. ↑ "Distinguished Teaching Awards". Robert H. Smith School of Business, University of Maryland. Retrieved 2016-09-21.
  55. ↑ "Winners". Robert H. Smith School of Business, University of Maryland. Retrieved 2016-09-21.

External links


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