The SEC has announced that it has turned over documents pertaining to the case to the DOJ.
Part of the controversy stems from SEC staffers allegedly backdating documents supporting the outfit’s actions.
Last July, the SEC leased 900,000 square feet of Grade A office space in an upscale area in Washington for $550 million. It turned out later that the outfit had no use for the space.
View examples of Washington, DC Office Space here
Now the SEC has turned over the power to lease buildings to another federal agency that handles leasing for government agencies and departments that do not have the power to lease their own buildings.
SEC Chairman Mary Schapiro told the House panel that the three employees who handled the leasing have been stripped of all duties.
“The fact that the SEC has not paid any rent to date for this property and that the bulk of the space has been leased to other tenants does not adequately address a situation that never should have occurred,” Ms Schapiro said.
Other federal agencies have agreed to take over 600,000 square feet of the leased office space, and the SEC is now searching for another tenant to take over the rest.
A barrage of criticism was unleashed on the SEC when it emerged that the lease was based on random, overinflated estimates of the SEC’s space needs. The SEC also failed to submit the contract to competitive bids.
The SEC estimated it would need at least 800 additional staff to handle the added responsibilities it expected to take on with the passage of the Dodd-Frank financial overhaul.
Editor’s notes: Further information regarding the SEC rushing to sign a lease for 900,000 square feet of office space at the Constitution Center can be found at the link.
As of September 2026, it was discovered that the building in question, the Constitution Center was was fully leased, with occupiers listed as the Office of the Comptroller of the Currency, the Federal Housing Finance Agency, the General Services Administration, the National Endowment for the Humanities, Centers for Disease Control & Prevention, the Administration for Strategic Preparedness & Response, and the National Endowment for the Arts.