Senior employees at the Securities and Exchange Commission (SEC) spent hours surfing pornographic websites on government-issued computers while they were being paid to police the financial system, an agency watchdog says.

WASHINGTON — Senior employees at the Securities and Exchange Commission (SEC) spent hours surfing pornographic websites on government-issued computers while they were being paid to police the financial system, an agency watchdog says.

The SEC’s inspector general conducted 33 investigations of employees looking at explicit images in the past five years, according to a memo written by SEC Inspector General David Kotz.

The memo says 31 investigations occurred in the 2 ½ years since the financial system teetered and nearly crashed.

The employees’ behavior violated governmentwide ethics rules, according to the memo written by Kotz in response to a request from Sen. Charles Grassley, R-Iowa.

The memo was first reported Thursday evening by ABC News. It summarizes past inspector general investigations. Among its findings:

• A senior attorney at the SEC’s Washington headquarters spent up to eight hours a day looking at and downloading pornography. When he ran out of hard-drive space, he burned the files to CDs or DVDs, which he kept in boxes around his office. He agreed to resign, an earlier watchdog report said.

• An accountant was blocked more than 16,000 times in a month from visiting websites classified as “Sex” or “Pornography.” Yet he still managed to amass a collection of “very graphic” material on his hard drive by using Google images to bypass the SEC’s internal filter, according to an earlier report from the inspector general. The accountant received a 14-day suspension.

• Seventeen of the employees were “at a senior level,” earning salaries of up to $222,418.

• The number of cases jumped from two in 2007 to 16 in 2008. The cracks in the financial system emerged in mid-2007 and spread into full-blown panic by fall 2008.

California Rep. Darrell Issa, the top Republican on the House Committee on Oversight and Government Reform, said it was “disturbing that high-ranking officials within the SEC were spending more time looking at porn than taking action to help stave off the events that put our nation’s economy on the brink of collapse.”

An SEC spokesman declined to comment Thursday night.

Former SEC spokesman Michael Robinson said he shares the public’s outrage about SEC staffers who enjoyed porn on the taxpayer dime when they were supposed to be keeping the markets safe.

“That kind of behavior is just intolerable and atrocious,” said Robinson, now with Levick Strategic Communications. He said he expects SEC Chairman Mary Schapiro and her team are “very focused on” the issue.