For years, the SEC has been dogged by claims that it would not take on the Wall Street giants. In SEC v. Goldman Sachs, discussed here, it did.

Rather than applaud however, the critics now claim foul and the agency finds itself embroiled in controversy about the enforcement action. The Wall Street Journal has argued the suit should never have been brought, discussed here. On Capital Hill, hearings have been held with Senators rushing to question Goldman executives. Charges that the suit was timed to help the administration win passage of its financial reform legislation have been raised by a number of lawmakers. Chairman Schapiro had vehemently denied the claim. Yet, the SEC’s Inspector General has opened an investigation despite that fact that the inquiry will focus on an existing, and on-going, enforcement action – a decision which, at best, seems questionable.

Now eight Republican Congressmen from the Committee on Oversight and Government Reform have sent a letter to Chairman Schapiro demanding information regarding the Goldman suit. Specifically, an April 20, 2010 letter from Representative Darrell Issa and seven of his collogues states in part that the case “has created serious questions about the Commission’s independence and impartiality . . . events of the past five days have fueled legitimate suspicion on the part of the American people that the Commission has attempted to assist the White House, the Democratic Party, and Congressional Democrats by timing the suit to coincide with the Senate’s consideration of financial regulatory legislation . . .”

After reciting what are claimed to be a number of information leaks, the letter requests documents and information including:

• A statement as to whether the Commission or its employees gave advance notice to the White House, the Democratic National Committee or Democratic members of Congress;

• All communications between the Commission and news outlets about the matter; and

• All records regarding any such communications.

It seems somewhat ironic that, after months of criticism from Capital Hill, the media and the public as the Commission worked to reorganize and rejuvenate its enforcement program, the filing of a high profile case has garnered such dismay. At the same time, if the agency did not bring significant cases tied to the causes of the market crisis – and the Goldman case clear goes to the root of much of what caused that crisis – the critics would no doubt be howling. As all the controversy swirls everyone seems to have lost sight of the fact that the function of the federal courts is to provide a forum for resolving the very questions that surround this case – either the SEC is right or Goldman is right. One of the parties will prevail. Everyone would do well be patient and let the court system do its job.