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Sep 14, 2011 8:52 PM by Trovette Tottress

SEC says some documents on big banks likely tossed

WASHINGTON (AP) - The Securities and Exchange Commission has acknowledged that some documents from preliminary investigations of
major banks and convicted swindler Bernard Madoff likely were destroyed under a former agency policy.

The SEC's enforcement chief made the disclosure in a letter Wednesday to Sen. Charles Grassley, R-Iowa. Grassley had asked about allegations by an SEC attorney that the agency illegally destroyed records related to thousands of preliminary probes, including on Bank of America, Goldman Sachs, Wells Fargo and Madoff.

Enforcement Director Robert Khuzami said the agency doesn't believe any investigations were harmed by the policy, which allowed documents to be discarded in cases that were closed when staff decided a formal probe wasn't warranted. A review by the SEC inspector general is under way to determine if any law was violated.

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