New York investor sues SEC over losses in Madoff fund

A New York woman who says she lost most of her savings investing with Bernard Madoff is seeking $1.7 million in damages from the Securities and Exchange Commission for failing to detect his fraud for a decade.

Phyllis Molchatsky, 61, filed an administrative claim against the SEC on Monday, accusing the SEC of "negligent conduct." The 13-page document says she invested $2 million in 2001 with American Masters Broad Market Fund L.P., a hedge fund associated with Madoff... SEC Chairman Christopher Cox said Dec. 16 that the agency failed to act on "credible and specific allegations" of wrongdoing by Madoff dating back to at least 1999.