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Apr 26, 2012



'an SEC attorney “inadvertently revealed the identity” of a whistleblower':

Anyone else think it wasn't "inadvertent"?


Mr. Canellos what about George Demos?

SEC, New York Regional Office

Below is a letter which was sent by George S. Canellos, Director, New York Regional Office, U.S. Securities and Exchange Commission, to the Wall Street Journal, which published an abbreviated version of it yesterday.

April 25, 2012
The Editor
The Wall Street Journal
1211 Avenue of the Americas
New York, NY 10036

To the Editor:

Today’s WSJ article headlined "Source’s Cover is Blown by SEC" is flatly inaccurate. The SEC in no way exposed Peter Earle as a whistleblower, and our use of his notebooks in an investigative deposition was neither "inadvertent" nor a "breach" or "gaffe." It was a deliberate decision, which SEC lawyer Daniel Walfish discussed in advance with his supervisor – who was present for the deposition in which the notebooks were exhibited.

Nor did the fully authorized use of the notebooks in any way compromise Mr. Earle or the integrity of the SEC’s investigation of the Pipeline Trading matter. It was widely known among Pipeline’s and Milstream’s executives that, after the termination of his employment in 2009, Mr. Earle had approached the SEC – a fact volunteered by witnesses and acknowledged by Mr. Earle long before the exhibition of his notebooks in November 2010. For example, Gordon Henderson, who supervised Mr. Earle and several other Milstream traders, testified in June 2010 that it had been "clear" to him and others at Pipeline since 2009 that Mr. Earle had approached the SEC. Still, throughout the investigation, the SEC declined to confirm his identity and still treated his status as a cooperating witness as confidential. The SEC made sure to obtain all notes of Milstream traders, and in the deposition of Mr. Henderson, the SEC used other traders’ notes along with those of Mr. Earle.

The use of these traders’ notes – highly relevant evidence prepared in the ordinary course of their work at Milstream – in no way revealed whether Mr. Earle or any other trader was or was not cooperating with the SEC. The article suggests that through recognizing the handwriting on Mr. Earle’s notes, Mr. Henderson finally came to know that Mr. Earle was in fact an SEC whistleblower. But there was no secret about whose notes were being shown to Mr. Henderson, and it is hardly surprising that he would be questioned based on the notes of his own traders – a very small group of key participants in the conduct under investigation – and that he would recognize their handwriting. The fundamental point is that there is nothing about the notes – important business records of trading activity supervised by Mr. Henderson – or about the SEC’s use of them as exhibits in questioning Mr. Henderson that revealed anything about whether Mr. Earle or others were cooperating in the SEC’s investigation.

In sum, this matter involves an individual who approached the SEC following termination of his employment; whose cooperation was widely known; who advised the SEC that his cooperation was known to his former employer; and who a number of witnesses volunteered knowing was cooperating with the SEC. And yet the SEC staff nevertheless took all appropriate measures to avoid revealing or confirming that the witness had contacted the SEC. These facts – which are beyond reasonable dispute – are dramatically at odds with the article as written.

George S. Canellos
Director, New York Regional Office


Most people (non-lawyers) believe what George Demos did was wrong and he should be disbarred. The Committee on Professional Standards reviewed the SEC OIG Report and found that George Demos did nothing wrong. Are they kidding. They also refuse to disclose their "investigation" to the public even though it was George Demos who violated Judiciary Law § 90(10).


Joe Jefferis

Here is a link to my public comment to the SEC:


Be sure to read the attachments at the bottom of the SEC comment page:

LOS ALAMOS, New Mexico, April 22, 2011—Los Alamos National Laboratory scientists have developed a way to avoid the use of expensive platinum in hydrogen fuel cells, the environmentally friendly devices that might replace current power sources in everything from personal data devices to automobiles.


It is not a SECret- just taboo.


The general public believes George Demos should be disbarred. However, the Committee on Professional Standards supports this kind of behavior. Lawyers protecting their own. Pathetic.



Trisha, according to the SEC, the action taken in Demos' case was "Counseling received prior to completion of OIG report; no action taken thereafter." You can see that document here - http://pogoarchives.org/m/fo/schapiro-letter-20110131.pdf


Ah, another Altschuler-backed hit on George Demos. The SEC did not "take no action." Like the racists who are so sure Trayvon just deserved to be murdered 'cause he was walking while black, you people seem to think that even THREE investigations -- including one by the NY Times -- that find a man innocent aren't enough. You're just so sure a dark-skinned person is guilty, that's that man!

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