By Sarah N. Lynch
WASHINGTON, Jan 25 (Reuters) - The U.S. Securities and Exchange Commission has selected a criminal investigator as its top internal watchdog, one day after President Barack Obama tapped a former criminal prosecutor as chairman of the agency.
The SEC has offered the job of inspector general to Capitol Police Inspector General Carl W. Hoecker, two people familiar with the matter told Reuters. One of those people said Hoecker accepted the offer.
The people spoke on the condition of anonymity because the hiring decision is not yet public.
Both Hoecker and an SEC spokesman declined to comment.
Hoecker will replace Jon Rymer, the Federal Deposit Insurance Corp's inspector general who has temporarily served as the SEC's inspector general while commissioners searched for a permanent replacement.
The selection was reported earlier on Friday by Bloomberg.
He joins the agency just as it gears up to welcome former U.S. Attorney Mary Jo White, who is expected to easily win Senate confirmation.
The SEC's decision to hire Hoecker signals a major change from past practices for inspectors general, a position that came under scrutiny over the past few years when David Kotz served in the top spot.
Considered an activist inspector general, Kotz raised the profile of the office by probing everything from the SEC's failure to catch epic Ponzi schemer Bernard Madoff to bungled SEC contracts and staff viewing pornography at work.
His aggressive tactics also made him many enemies. At least two SEC staffers filed formal complaints against him with a council that oversees inspectors general, alleging he did not offer the targets of his probes due process and created a culture of fear at the agency.
In previous interviews with Reuters, Kotz denied all of the allegations made against him.
He left the SEC about a year ago amid an ethics scandal and potential conflicts of interest reported by Bloomberg.
Rymer was installed in May last year to help restore order after the office experienced a separate scandal involving former assistant inspector general for investigations David Weber.
Weber was placed on leave last spring after some employees complained he spoke openly about wanting to carry a gun at work.
Weber was later fired and sued the SEC in November alleging he was wrongfully terminated and retaliated against for trying to investigate and shed light on a variety of misconduct at the agency.
The SEC has vowed to vigorously contest the lawsuit.
Hoecker, who has served as the inspector general of the Capitol Police since 2006, has more than 30 years experience as a criminal investigator and is also a certified public accountant and fraud examiner.
He has also been a U.S. military policeman, a special agent in the Army Criminal Investigations Command, a criminal investigator of the U.S. Information Agency and a deputy inspector general for investigations at the Treasury Office of the Inspector General.
As inspector general, Hoecker will be tasked with rooting out waste, fraud and abuse at the SEC.
The workload in the office is divided between routine audits of SEC programs and investigations into potential wrongdoing.
Hoecker also has experience pushing for proper oversight of the work of inspectors general, as the current chairman of the investigations committee of the Council of the Inspectors General on Integrity and Efficiency, or CIGIE.
CIGIE has various committees that oversee peer reviews of other watchdogs' audits and investigations.
Allison Lerner, the National Science Foundation's inspector general who serves on the investigations committee with Hoecker, said he is a solid choice for the SEC.
"I believe his skills as an investigator and a CPA will combine to make him an outstanding inspector general at the Securities and Exchange Commission," she said.