WASHINGTON – President Bush asked Congress on Monday for an $841 million budget for the Securities and Exchange Commission, marking the biggest jump in the agency's history as it investigates and prosecutes a heavy load of corporate fraud and accounting deception.
The SEC, already strained in recent years by an exodus of attorneys and accountants to the private sector, has been unraveling the accounting failures at a variety of businesses including Enron, WorldCom, Xerox, Rite Aid and Adelphia Communications. The agency has taken enforcement actions against a number of big companies, often in tandem with the Justice Department.
In addition, the SEC has responded to last year's corporate scandals by stepping up its routine reviews of companies' annual reports and other periodic filings.
The administration's SEC budget proposal for next fiscal year that begins Oct. 1 reflects a 48 percent increase from last year's request. A real comparison — with actual spending — is difficult, however, because the agency's funding for the current year has not yet been determined by Congress.
Even if Congress approves the new money, SEC officials say it has become difficult to attract accountants in a tight job market.
"Everyone's trying to hire accountants," SEC Executive Director James McConnell told reporters in a telephone conference call. "Everyone's trying to hire accountants."
Democrats in Congress have urged Bush to boost funding for the SEC.
"Better late than never, long overdue and extremely necessary as we seek to restore investor confidence," said Sen. Paul Sarbanes of Maryland, senior Democrat on the Senate Banking Committee and an author of last year's legislation to combat corporate fraud.
The new money would enable the SEC to hire 710 new attorneys, accountants and examiners, McConnell said. That would bring the staff of the agency — created in 1934 in response to the 1929 stock market crash — to 3,875.