prior to joining the sec mr. kotz or does inspector general for the peace corps, and practice federal administrative law for a decade in the private sector to inspector general potts is a graduate of the university of maryland which makes him a terrapin, and a cornell law school. jeff heslop was named the u.s. securities and exchange commissions first ever chief operating officer in may of 2010 commuters bought for the agency's information technology our natural reporting and record management duties. prior to 20 sec, he was managing vice president at capital one which is just acted to acquire ing direct in delaware right in my hometown. and capital one mr. heslop was responsible for companies information and risk management operations. he received his bachelor of arts degree from davidson college. davidson college, when did you graduate? 76. john spratt, congress and john spratt is one of your graduates as will. do you know who the president is there no? [inaudible] >> she is from delaware. delaware. she just became

>> the disciplinary process essentially your report was issued, mr. kotz iban on the 17th of may of this year. and since that time we have followed mr. cox's guidance. we have reviewed the report to our general counsel has analyzed in great detail. we have conducted sublunary investigations and supplementary interviews. there was a slight hold when basically when mr. kotz referred to the department of justice, the individuals mentioned in the report as a matter of practice. we don't complete investigations or interview the individuals named to the department of justice comes back to us and gives us they're okay that we can so doesn't interfere with their investigation. we receive it okay. the investigation then began to proceed. as the investigation unfolded, it became apparent that in the interest of objectivity and fairness, it would be in our best interest to hire an external party to help us conduct that investigation. we are in the process right now. >> so in fairness to the taxpayers, it's like there is for the individual. what about fairness to the

prior to joining the sec, mr. kotzved as inspector general for the peace corps in practice federal administrative law for a decade in the private sector. inspector general kotz is a graduate of the university of maryland and the cornell law school. jeff is it heslop? good. was named th was named the u.op? good. was named the u.s. securities and exchange commissioner's first-ever chief operating not certain may 2010. users also afford the agency's technology, reporting records. prior to joining the sec, ms. dÜrer heslop was at capital one, which was just acted to acquire ing direct in wilmington, delaware, right in my hometown. their capital one who is responsible for the company's information risk management operations and received his bachelor of arts degree from davidson college. when did you graduate? [inaudible] >> 76. congressman john spratt. you know who the president is there now? [inaudible] >> schuster in delaware. delaware. she just became your president the first of this month and i think the first woman in

mr. kotz? >> what struck me, mr. chairman, is what you said about the incentives at the beginning of the hearing. there should in the be an incentive to lease versus purchasing. it should be with respect to maximize value for the pax theyer. that's where the incentive needs to be whether it's purchasing or leasing and we've gone away with that by focusing on one type of effort. if something was done with the appropriate incentives in place, we would all be in better shape. >> good. there might be an exception when leasing makes more sense, in a classic sense where you need a lot of space every ten years, but not for ten years. >> the incentive in that case it's to lease, but in other cases, it's to buy. >> thanks. mr. sullivan, please. >> number one we heard today is the critical nature having good internal controls and professionally groomed, if you will, contracting and management staff. vas spending significant amount of effort, time, and resources to ensure our leasing staff is fully trained meeting all the requi

mr. kotz, please proceed. >> i appreciate the interest of the chairman and the ranking member and the sec and the office of inspector general. on november 16th, 2010, we opened an investigation as a result of receiving numerous written complaints concerning the sec's decisions and actions relating to the leasing of space at the constitution center office building in washington, d.c. as part of our investigative efforts we analyzed thousands of pages of documents and interviewed 29 witnesses with knowledge of facts or circumstances surrounding the sec's leasing of the space. we also searched over 1.5 million emails for various time periods pertinent to the investigation. on may 16th, 2011, we issued a comprehensive report of an investigation containing over 90 pages of analysis and 150 exhibits. .. >> this death was an all-inclusive number that included, space and amenities, an additional 10% of contractors, tends% for interns and staff in 5% for future growth. we found a 400 square feet per pe

mr. kotz? >> the one thing that struck me is what the chairman was saying about the disincentives in the beginning of the hearing. there shouldn't be an incentive in place to lease versus purchasing. the incentive should be with respect to maximizing value for the taxpayer and that is where it needs to be whether it is purchasing or leasing and perhaps we have gone away from that by focusing on one particular type of effort if something was done to put the appropriate incentives in place i think we would all be in better shape. >> there might be an exception when the leasing does make more sense with a lot of space every ten years to reduce bank of the incentive is to maximize value, the incentive would be leasing and other cases would be defined to expect things to read mr. sullivan, please. >> number 1i think we heard today the critical nature having good internal controls and professionally groome if you will contract in project management staff. the va has spent a significant amount of time