New York State Attorney Eliot Spitzer threw another barb at the Securities and Exchange Commission, on the eve of the showdown this week on Capitol Hill – this one apparently directed at Paul Roye, director of the Division of Investment Management.

"If I had been the head of the bureau overseeing the mutual fund industry for the past year, I would resign," Spitzer told the New York Post.

"This is an outrage that should distress every mutual fund investor," Spitzer went on, in another interview with The Wall Street Journal. "What has emerged is one of the most scurrilous tales I’ve seen yet – an outrageous betrayal of the public trust by that agency.

"The regulators who were supposed to have been watching this industry were asleep at the switch. And I’m going to pull that switch."

For his part, SEC Chairman William Donaldson told a Congressional hearing: "The spectacle of one regulatory agency criticizing another is not healthy," adding, that the attorney general’s "comments are both wrong and pernicious."

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