An analysis released Wednesday suggests that SEC and FBI prosecuted federal financial crimes are decreasing dramatically. At a time where the Madoff case is taking priority, questions are being asked how such large scope fraud sneaks passed the government overseers for so long.

Rather than actual cases of fraud falling, many analysts would agree that it seems prosecution and detection efficiency is unsatisfactory; a reduction of budget and enforcement measures at the SEC over the last decade is to blame.

The analysis published in the New York Times suggests that a redirection of enforcement efforts towards policing terrorism at the F.B.I., and a largely unsatisfactory budget at the SEC has “made the [government] something of a paper tiger in investigating securities crimes.”

Prosecutions in financial crime are at the lowest point since at least 1991, with approximately 133 prosecutions this fiscal year, down from a high of 513 cases in 2002, a year of Enron and WorldCom corporate crime scandals.

“The Commission believes strongly that it is vital that SEC investigators, examiners, and enforcement staff be above reproach while conducting their duties, in order to ensure the integrity and effectiveness of the SEC,” says the SEC in a press statement, with particular regard to the Madoff case.

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