You gotta Levitt: S.E.C. chairman admits to not being able to read a prospectus
Would you be shocked if I told you that the Securities and Exchange Commission (S.E.C.) chairman cannot read a prospectus? Well, as ridiculous as it sounds, that certainly was the case with former S.E.C. Chairman, Arthur Levitt.
Mr. Levitt, S.E.C. chairman during the Clinton years, admitted in his 2002 book “Take On the Street” that he had trouble understanding a prospectus when he was chairman. In his semi-autobiographical book, he goes on to say how embarrassed he was about this gross incompetence.
When reading Mr. Levitt’s book, I couldn’t believe his admission and its disheartening implication. Forget about the discussion about how the average consumer isn’t sophisticated enough to avoid the pitfalls of a complex mortgage product or an esoteric credit card agreement. What does this revelation say about the commission whose very task it is to police the most complex financial markets in the world?