In testimony before the House Subcommittee on Financial Services, SEC chairman Mary Schapiro identified IT investment as a key priority for the agency over the coming year.

She says: "While the markets were growing exponentially in size and complexity, the SEC was getting smaller and its technology was falling further behind. We are only just now returning to the budget and staffing levels of five years ago."

The President is requesting a total of $1.258 billion for the agency in FY 2011, a 12% increase over the FY 2010 funding level. Schapiro says the funds will enable the watchdog to hire an additional 374 professionals - a 10% increase over FY 2010, bringing the total number of staff to just over 4200.

"The request also will permit us to continue expanding our investments in surveillance, risk analysis, and other technology, as well as in better training for SEC staff," says Schapiro.

She says an additional $12 million will be allocated to the IT budget for 2011 as the SEC invests significant sums on a number of ongoing projects. These include improving the Division's case management system, managing ever-increasing amounts of electronic evidence with sophisticated new tools, and establishing a more centralised system for reviewing and analyzing tips, complaints, and referrals.

"We intend to commit whatever resources are necessary and available to ensure a timely conclusion to these upgrades," says Schapiro. "We also anticipate major future projects, including a new state-of-the-art IT Forensics Lab, enhanced data and trading analytics, and improved document and knowledge management to further enhance efficiency and consistency across the Division."

Earlier this week, the SEC's UK counterpart the Financial Services Authority, also laid out plans to strengthen its supervision and grow its headcount by 14% to 3700 staff.