Enforcement Specialization and Management Streamlining Questions & Answers Specialty Units |. How were the specialty units selected? ‘We looked at the types and numbers of cases and investigations the Division hhas done historically; what we're doing currently; and what we think will be important to be doing in the future. We also were looking for the areas that might gain the greatest benefit from specialized expertise. . How was unit size determined? ‘This initial size is a guideline only. Our plan is to create units that remain nimble and responsive to new developments but have adequate staffing to develop specialized knowledge. - Ifthe specialized units will be tasked with working on matters that are, in one way cr another, more important and have higher priority, then I am not sure that it makes sense to allocate the majority of the staff to the remaining matters, ‘Shouldn't our goal be to allocate most of our resources to cases that are important? We believe there will be cases of equal importance that will be worked outside the units, so it’s important that we allocate resources in both areas. |. How many supervisory positions and staff positions will be in each specialized unit? As a corollary, how will the remaining groups be structured? For example, how many AD positions will be created and how will they be distributed? ‘The unit chief will determine number of unit members in consultation with associate group and local offices. Ratio of staff to supervisors vill remain constant across entire division. 5. [would like to find out more about the vision for the proposed group specializing in structured and new products. If this group is envisioned as primarily an enforcement unit, focused on bringing cases, what tools will or even can it utilize to learn about new products being developed by the financial industry? Currently, it seems that examination staff has more tools for obtaining this kind of information.‘We will be working closely with OCIE and the local examination groups; we will also be hiring industry experts to work within these groups. 6. It seems surprising that no accounting fraud unit is proposed. What was the thinking on this issue? Financial fraud is a large component of the enforcement program. With the exception of the managed asset unit, this was viewed as a focused rollout. We will revisit these issues after we've had a chance to see how these units operate. 7. In the specialized units, will an effort be made to have the AD's staff located in the same office? Yes. 8. By the time ADs have to decide whether to apply to be an AD ofa local specialty ‘group, will we know who thie chief of the group is? Yes. 9. When the Specialty Units are in place, will some cases be taken away from local offices and HO Associate groups? ‘Any case within the specialty area that both needs and will benefit from the specialized expertise within the Unit will likely be placed in the Unit. This determination will be made by the Unit Chief, in consultation with the local Regional office head or associate director 10. What are the definitions of the types of cases and violations which will be encompassed within these five “specialized” units? ‘The unit chief will be responsible for determining the cases that will be kept in the units and eases that may be investigated outside the units. 111, Who will make decisions as to which unit will take on a case when the conduct involved could fall within more than one specialized units area of emphasis? ‘What unit will perform the initial triage of enforcement referrals from different sources to ensure that they are assigned to the appropriate units or offices? ‘We expect that unit chiefs and local senior management will work through those issues when they come up. Local office heads and associates will be responsible for making sure unit chiefs are aware of potential unit cases. 12, How will ongoing investigations be handled? For instance, [have some significant matters within my group that are being handled by multiple statattorneys plus of course a branch chief. It is possible that all these people could end up in various other groups.: Will they be required to see the cases through-to the end (or at least to some reasonable point)? ‘We will work on transitioning cases in a way that causes the least possible disruption to the case, while keeping in mind that new unit members will have a number of new responsibilities. 13, What happens if a case starts as non-specialty case, e.g. a 2-3 individual insider trading case, and grows to fit the criteria ofa specialty unit case, eg. institutional insider trading? ‘We will try to minimize movement of cases among staff to avoid inefficiencies; if unit issues are implicated in a non-unit case, the unit chief should be consulted about the right approach for that case. 14. At what point will decisions be made about whether new matters-should be handled by one of the new units? If staff develops an interesting area that wasn't apparent at the beginning of the investigation, could the matter nevertheless be transferred at this later stage? Determinations about whether a case goes to a unit should be made upon intake, or as early in the investigation if possible. Whenever particular unit expertise would be helpful to a case, the unit chief should be consulted. 15. Ifa smaller percentage of the staff will be in specialized units, how will the case selection and prioritization process be improved for the remaining majority of the staff? What will be the programmatic priorities for that group, and how will they be determined and communicated to the staff? ‘We are working on a number of new approaches including the development of an Office of Market Intelligence, which will triage and prioritize incoming complaints, tips and referrals. ‘The Office of Market Intelligence will work together with the unit chiefs on matters relating to the units. 16. How will local Associate groups and regional offices interact with the specialized ‘groups on cases that relate to the subject matter ofthe specialized group? Will the specialized group review action memos, will they have to be consulted on how to rn the investigations, will they make charging decisions and decide on settlements? For unit cases, local Associate groups and regional offices will make recommendations that will be subject to the final approval of the unit chief, ‘who will have ultimate authority over all investigations in the unit. Other cases that are not in the unit but may benefit from unit expertise will followthe ordinary course; however, local associate groups and offices will be encouraged to consult the unit on such matters. 17. On what basis will staff attomeys be assigned to Assistant Director groups? If have particular people in my group who I work well with (and they want to continue to be in my group), will that be accommodated? Staff for the specialized groups will be selected by the unit chief from the volunteer applicants, in consultation with the local associate or office head. With respect to staff attorneys who do not enter a specialized group, we continue to work with the union to resolve those issues. 18. The specialized groups are to be made up of volunteers. What if the groups aren’t filled? Will staff be asked/told to join? Will staff attorneys have to interview for the positions? If 10 staff volunteer for 10 open positions, do they all get into the ‘group or can some be rejected? ‘We anticipate that there will be significant interest in the units, and that participation will not be an issue; however, we will work with the union and ‘Human Resources to make sure we have in place the proper procedures if we do not get enough volunteers. 19. What will be the selection criteria for investigative staff in the new units? We, in coordination with the Union and OHR, will be defining selection criteria for unit selection. We anticipate that the unit chief, once selected, will also be involved in the process. 20. If Tam interested in joining a specialty unit what do I do? Apply. We'll be working out the process and selection criteria with HR and the union. 21. Who will be in charge of the Specialty Units? ‘A national unit chief will have authority for the national program. Regional Offices and home office associate groups will also have local units. 22. Will the positions for heads of the new specialized units be filled first? Yes. 23. Will the positions for heads of the new specialized units be filled first? Yes.