Greenlight Capital Comments on SEC-OIG Report Regarding Failed Investigation of Allied Capital

Mar 23, 2010, 13:08 ET from Greenlight Capital

NEW YORK, March 23 /PRNewswire/ -- The following is a statement issued by Greenlight Capital:

The recent SEC-OIG report substantiates our account of events as told in Fooling Some of the People All of the Time.  Allied Capital (NYSE: ALD) used its political influence to corrupt law enforcement efforts.  The SEC's failure to act, despite its own investigation pointing to fraud, enabled Allied to go on to raise over $1 billion of fresh equity causing investors additional harm.  Yet, even though Allied's shareholders have lost billions, Allied management received extraordinary compensation and made millions of dollars from insider sales of Allied stock and options without any legal consequences.  

This is the second time in as many weeks that an official report has substantiated claims made by Greenlight Capital.  The SEC seems more interested in needlessly investigating market participants rather than uncovering corporate malfeasance and protecting investors.  While the SEC-OIG report sheds light on troubling behavior, it is heavily redacted.  Given the dubious behavior of the regulators, we call upon the SEC to immediately release the non-redacted version of the report.  The government sanctioned culture of lawlessness that allowed this fraud to occur cannot continue.  Even at this late date, it is not too late for the government to hold Allied and its management perpetrators to full account for their conduct.  

SOURCE Greenlight Capital