Finance watchdogs looked at porn as banks collapsed

The heated atmosphere inside the Securities Exchange Commission, the agency charged with monitoring the US financial industry, may have had less to do recently with turmoil in the markets and more with ructions between the sheets, on account of senior staffers spending their days sampling internet pornography instead of Wall Street data.

Details of no fewer than 33 inquiries by the SEC's inspector general over the past five years into instances of employees using office time to search for dirty pictures and video on their government-issued computers were uncovered in an internal memo obtained by the Associated Press. Seventeen of those involved were "senior level" employees earning up to $222,418 (£144,846) a year.

The revelations have not come at a good time for the SEC, which has already had a bruising couple of years, not least over its failure to stop Bernie Madoff and his Ponzi scheme. It also comes days after the filing of the SEC's controversial suit against Wall Street giant Goldman Sachs for alleged fraud.

Republicans pounced yesterday on the tawdry news. Many are glad of an opportunity to slap the SEC, in part because of a suspicion that the move against Goldman was politically inspired to help Democrats push a pivotal financial reform bill through the US Senate. They noted that 31 of the 33 investigations occurred in the past two years, when the SEC should have been focused on the financial crisis.

The lead Republican on the House Oversight Committee, Darrell Issa, said he found it "disturbing that high-ranking officials within the SEC were spending more time looking at porn than taking action to help stave off the events that put our nation's economy on the brink of collapse".

While the SEC did not itself respond to the revelations, former spokesman Michael Robinson called the behaviour "intolerable and atrocious". The leaked memo includes reports of a senior SEC lawyer who spent eight hours a day surfing sex-related sites and downloading material on to his hard drive. The drive eventually was filled, and he then copied material on to DVDs or CDs, it said. The lawyer later resigned.

A recent survey by a web consultancy in America estimated that 16 per cent of men turn their attention to internet pornography while at work.