S.E.C. Facing Wide Review of Practices

The Securities and Exchange Commission, under scrutiny for its handling of an insider-trading case involving a prominent hedge fund, will be the subject of a broad review by the investigative arm of Congress, the Government Accountability Office.
Charles E. Grassley, the Iowa Republican who is chairman of the Senate Finance Committee, last month asked the office in a letter to conduct a review of the commission because he was growing concerned, he said, about whether it is “faithfully adhering to its mission.”
The S.E.C. is charged with protecting investors by policing the nation’s financial markets and prosecuting violations of securities law by individuals and companies.
Last week, the G.A.O. accepted Mr. Grassley’s request that it review two S.E.C. divisions: its enforcement unit, which brings civil securities suits, and the office of compliance, inspection and examination, which oversees money managers, brokerage firms, stock exchanges and other regulated entities.