A Matter Under Inquiry (MUI, pronounced "muey", sometimes called Matter Under Investigation) is a term used by the United States Securities and Exchange Commission to describe preliminary investigations it makes into alleged financial fraud in the companies that it is responsible for regulating. MUIs may lead to more serious formal investigations, or they may be closed and no further action taken. The procedures and rules for when and how to open and close MUIs are described in the agency's Enforcement Manual (which was first published in 2008), as well as other SEC memorandum In the 2000s (decade) era, any MUI that was not cancelled, automatically became an 'informal investigation' after a certain period of time.

The American Spectator ''The American Spectator'' is a conservative American magazine covering news and politics, edited by R. Emmett Tyrrell Jr. and published by the non-profit American Spectator Foundation. It was founded in 1967 by Tyrrell, who remains its editor- ...

published an article in 2006 by Peter Wallison criticizing this practice, and arguing that it was too difficult for SEC employees to close investigations that it deemed unwarranted. MUI-closing-form1

MUIs are tracked in the SEC's computerized Case Activity Tracking System (CATS). Some information related to MUIs may also exist or have existed in the past in other SEC computer systems, such as the Super Tracking and Reporting System "STARS", the Name Relationship Search Index (NRSI), and the "Hub".

Notable MUIs

MUIs are given "MUI number" codes, and also sometimes referred to by titles. Here are a few notable examples: *MNY-07563, "Certain Hedge Fund Trading Practices" ( Madoff case, SEC OIG report) *MLA-02469, "Certain Broker Dealers in Violation of Limit Ord..." ( Madoff case, SEC OIG report) *MLA-01909, Goldman Sachs, alleged Market Manipulation *MHO-09356,

Deutsche Bank Deutsche Bank AG (), sometimes referred to simply as Deutsche, is a German multinational investment bank and financial services company headquartered in Frankfurt, Germany, and dual-listed on the Frankfurt Stock Exchange and the New York Sto ...

, alleged Insider Trading *MHO-09432,

, alleged Market Manipulation *MNY-07013,

Lehman Brothers Lehman Brothers Holdings Inc. ( ) was an American global financial services firm founded in 1847. Before filing for bankruptcy in 2008, Lehman was the fourth-largest investment bank in the United States (behind Goldman Sachs, Morgan Stanley, a ...

, alleged Financial Fraud *MNY-08198, Goldman Sachs, alleged Insider Trading *MNY-08145,

American International Group American International Group, Inc. (AIG) is an American multinational finance and insurance corporation with operations in more than 80 countries and jurisdictions. , AIG companies employed 49,600 people.https://www.aig.com/content/dam/aig/amer ...

, alleged Insider Trading *(code unknown) - 1998 Stanford MUI, alleged Ponzi scheme of Robert Allen Stanford

Routine destruction of closed MUIs

According to former SEC employee and

whistleblower A whistleblower (also written as whistle-blower or whistle blower) is a person, often an employee, who reveals information about activity within a private or public organization that is deemed illegal, immoral, illicit, unsafe or fraudulent. Whi ...

Darcy Flynn, as reported by

Matt Taibbi Matthew Colin Taibbi (; born March 2, 1970) is an American author, journalist, and podcaster. He has reported on finance, media, politics, and sports. A former contributing editor for ''Rolling Stone'', he is an author of several books, co-host o ...

Rolling Stone ''Rolling Stone'' is an American monthly magazine that focuses on music, politics, and popular culture. It was founded in San Francisco, California, in 1967 by Jann Wenner, and the music critic Ralph J. Gleason. It was first known for its ...

in 2011, the agency routinely destroyed thousands and thousands of MUI documents related to investigations of alleged crimes committed by

, Goldman Sachs,

, SAC Capital, and other financial companies involved in the

Great Recession The Great Recession was a period of marked general decline, i.e. a recession, observed in national economies globally that occurred from late 2007 into 2009. The scale and timing of the recession varied from country to country (see map). At ...

that the SEC was supposed to have been regulating. The tradition of destruction began as early as the 1990s. This eventually caused a conflict with the

National Archives and Records Administration The National Archives and Records Administration (NARA) is an " independent federal agency of the United States government within the executive branch", charged with the preservation and documentation of government and historical records. It ...

when Darcy Flynn revealed the activity to NARA in 2010. Flynn also described a meeting at SEC in which top staff discussed refusing to admit the destruction had taken place because it was possibly illegal. The SEC claimed that it stopped destroying MUI documents in 2010.

Position in SEC enforcement process

''Chart from Government Accountability Office reportSECURITIES AND EXCHANGE COMMISSION Additional Actions Needed to Ensure Planned Improvements Address Limitations in Enforcement Division Operations
August 2007 GAO-07-830''

References

{{reflist, refs = S.E.C. Files Were Illegally Destroyed, Lawyer Says
By EDWARD WYATT, August 17, 2011 The securities enforcement manual: tactics and strategies By Nicole A. Baker, Kirkpatrick & Lockhart Nicholson Graham
American Bar Association, 2007 Is the SEC Covering Up Wall Street Crimes?
Matt Taibbi, Rolling Stone, 2011 August 17 2006 internal SEC email
sec.gov, part of the SEC OIG investigation into the Madoff case. retrieved 2011 8 17 2009 internal SEC document
sec.gov, part of the SEC OIG investigation into the Madoff case. retrieved 2011 8 17
sec.gov, retrieved August 17, 2011
STANLEY C. MORRIS, Securities Attorney, Corrigan & Morris LLP. cormorllp.com retrieved 2011 aug 17 Handling a Regulatory Investigation
SIFMA Compliance and Legal Society, 2011 Annual Seminar. retr August 17, 2011 Rude Awakening at the SEC
By Peter J. Wallison , The American Spectator , ARTICLES & COMMENTARY Monday, May 1, 2006 Letter from Chuck Grassley, US Senate Judiciary Committee, to Mary Schapiro, SEC
{{webarchive, url=https://web.archive.org/web/20110821051950/http://grassley.senate.gov/about/upload/2011-08-17-CEG-to-SEC-MUI.pdf , date=2011-08-21 , 2011 8 17, inquiring about MUI destruction For example, the memo entitled "Memorandum for Field Office Heads and Associates for Enforcement and Examinations, Tracking Examination Referrals and Investigations Generated from Referrals, November 8, 2006". This memo is not available but was described in the SEC OIG Report: "OCIE Regional Offices’ Referrals to Enforcement: March 30, 2011 Report No. 493
from sec-oig.gov
{{webarchive, url=https://web.archive.org/web/20110911004926/http://www.sec-oig.gov/Reports/AuditsInspections/2011/493.pdf , date=2011-09-11 , page 2 Investigation of Failure of the SEC to Uncover Bernard Madoffżs Ponzi Scheme
SEC, via Google Books. See also:
COMPLIANCE INSPECTION AND EXAMINATION REFERRALS TO ENFORCEMENT EXECUTIVE SUMMARY
{{webarchive, url=https://web.archive.org/web/20111006170843/http://www.sec-oig.gov/Reports/AuditsInspections/2001/322fin.pdf , date=2011-10-06 , SEC OIG. Examination Referrals, Audit 322, June 28, 2001 See also:
OCIE Regional Offices Referrals to Enforcement
{{webarchive, url=https://web.archive.org/web/20110911004926/http://www.sec-oig.gov/Reports/AuditsInspections/2011/493.pdf , date=2011-09-11 March 30, 2011 Report No. 49, pg 2 all retrieved August 18, 2011 U.S. Securities and Exchange Commission