The Securities and Exchange Commission announced it is adopting new internal rules intended to avoid conflicts of interest among employees. In a statement released by Chairman Mary Schapiro early this week, she said that the agency plans to implement the recommendations proposed by its Office of the Inspector General to improve the procedures and processes within its Office of the Ethics Counsel.

The OIG report was issued in response to the case of former SEC counsel, David Becker's potential conflict of interest. Becker was involved in making policy decisions at the SEC on the Bernard Maddoff scandal, even though he was personally involved in the case due to an inheritance with ties to Maddoff funds. The inspector general issued a three recommendations for the SEC to adopt to avoid future staff's personal involvement when carrying out their duties on behalf of the agency.

OIG recommends that the SEC ethics office should

report directly to the Chairman instead of the general counsel

implement policies and procedures to properly determine if an employee's actions may violate rules or is inappropriate, give out well-reasoned and consistent advice to personnel

take all necessary actions to ensure all advice provided in significant matters are well documented in an appropriate and consistent manner

“Moving forward, we plan to implement the other recommendations contained in the report as well,” said Schapiro in a statement.

Becker had inherited his mother's estate which had invested in Madoff funds. Though he did report the matter to the SEC ethics counsel ahead of the assignment schedule, the ethics counsel approved Becker's involvement in the assignment, ignoring the possible violation to rules as conflict of interest is involved. Becker has since February this year resigned from his position at the SEC.