When Rhea Dignam reached Ernst & Young’s mandatory retirement age a few years ago, she decided 60 was too young to call it a career.
For 15 years, she had worked in New York for New York Life Insurance Company and then for the accounting giant.
But, before that, she had earned her stripes going after narcotics dealers and corrupt politicians as a federal prosecutor in the big city in the 1970s and 1980s. She had also worked as a deputy comptroller for New York City.
“I very much wanted to return to the public sector,” said the Harvard-educated lawyer. “That’s where my heart has always been.”
So, after a lifetime in and around New York’s courtrooms and corporate and municipal offices, Dignam followed her heart to Atlanta 17 months ago, to head the U.S. Securities and Exchange Commission’s Atlanta regional office.
She arrived at the SEC when regulators and lawmakers were trying to clean up the messes left by the near meltdown on Wall Street in 2008.
As head of the SEC’s regional office, Dignam oversees about 90 full-time employees who perform examinations and investigations of investment firms, individuals and publicly traded companies in a five-state region.
Here, Dignam talks about joining the SEC following the recent financial crisis and passage of the Dodd-Frank Act, intended to promote the stability of the country’s financial institutions by improving accountability and transparency in the financial system.
Q: You've had an extensive career in both the government and private sectors. Why is the SEC where you wanted to cap your career?
A: At the time [I took the job], we were still as a nation in the throes of the Great Recession. ... It was clear to me that a lot of investors had lost a lot of money. ... This agency's mission was particularly critical at that point in time.
Q: Tell me about the SEC's regional office. What does it do?
A: We have three programs here – enforcement, examination and reorganization [bankruptcies]. ... Examination and enforcement are the two big programs.
Q: How would you describe the focus of this office? Is it mainly about catching bad guys or helping to avoid another financial meltdown?
A: I wouldn't say either of those. I wouldn't phrase it that way. ... Our function is assessing compliance [with federal securities laws]. ... In this region, we're probably more focused on individual investors than large system issues [that might cause disruption of the financial markets].
On the enforcement side, we’re interested, essentially, in fraud.
Q: Between the extra tools and the extra work, has the Dodd-Frank financial overhaul bill, enacted by Congress about a year ago, made your job harder or easier?
A: The resources were already an issue when I got here. ... If you look at the South, our region, it's had enormous growth over the last 10-15 years, and this office did not in any way grow commensurately. And then Dodd-Frank does give us new and expanded responsibilities. ... That's a challenge. ... One thing that I think will help is you do have the financial reward program [for whistle-blowers, a new program under Dodd-Frank].
Q: How will that help?
A: Nobody does a major fraud on their own. Others have to be involved. There are people who know the business, who, even if they don't know to a certainty that something bad is going on, because they're in the business, they know something doesn't add up here.
Q: What's your advice to investors?
A: I think the educated investor is always the best investor. Our tools focus on the obligation of the [company] to make good disclosures. ... Investors who view the written disclosures as irrelevant do so at their peril.
