Former Gov. Eliot Spitzer — once known as the “Sheriff of Wall Street” for cracking down on financial institutions as New York’s attorney general before being brought down by prostitution scandal — said financial reform should target federal regulators as well as banks.
“We have not reformed the system,” Spitzer told the CBS “Early Show” this morning. “We still have institutions that are too big to fail, institutions that have received billions … of taxpayer dollars are not investing that back into the system to create jobs for the future.
Spitzer added that the regulatory system currently in place is “utterly in disarray.”
His comments come as President Obama visits the city today to revive a stalled push for stricter oversight of Wall Street — using the anniversary of Lehman Brothers’ collapse to argue for sweeping regulatory changes.
Spitzer said regulators — including the Securities and Exchange Commission — failed last year to stop a financial meltdown, but not because they lacked power.
“The SEC had all the power it needed but chose not to use it,” Sptizer said. “The Federal Reserve Bank had all the power it needed but they, perhaps most egregiously of all — the New York Fed in particular — utterly failed to do what needed to be done. And that was the problem.
“The hard part is what follows. And that is reforming the system and creating jobs. And in each of those critical areas, we are not doing well,” he added.
Spitzer, a Democrat, resigned as governor in March 2008 after a federal probe charged that he was a client of a high-priced prostitution ring and had had an encounter with a call girl named Ashley Dupree.
No charges were ever filed against him.
Spitzer also said that he’s putting his family life back together after the scandal.
“I am fortunate to have an angel for a wife who has been spectacular and three daughters likewise who are wonderful and the center of our lives,” he said. “What more can one ask for?”
With Post Wire Services