The announcement came just over one month after Harry Markopolos, a Boston fraud investigator, told Congress the nation's top securities regulator ignored his repeated warnings that Madoff was running a scam.

The SEC said the Center for Enterprise Modernization, a federally funded research and development center, would review the agency's current procedure for evaluating complaints and recommend ways to centralize and improve the process.

Recently appointed SEC Chairman Mary Schapiro said the review would identify and correct gaps or problems that could "prevent us from ensuring swift and vigorous enforcement."

The announcement, Schapiro's latest move to revitalize the SEC and change policies of predecessor Christopher Cox, didn't mention Madoff. But the context was clear.

"It's a step in the right direction that should make it more likely the SEC will investigate before an issue turns into a multibillion-dollar investment scandal," said Mercer Bullard, president of Fund Democracy, an advocacy group for mutual fund shareholders.

Madoff is under house arrest in New York following his December arrest for allegedly running a scam with $50 billion in potential losses. He's expected to seek a plea deal.

Markopolos told a House panel last month he filed five Madoff complaints with the SEC from 2000 through 2008. One was titled "The World's Largest Hedge Fund is a Fraud." Each time, he said, regulators failed to act.

Markopolos' warnings were among at least 12 similar complaints to the SEC from 2003 through 2006. SEC Inspector General David Kotz is examining the agency's handling of the Madoff case.

In his testimony, Markopolos urged creation of a whistle-blower office at the SEC's Washington headquarters to centralize ad hoc efforts at 11 regional offices. He said industry and investor complaints are "the cheapest, most effective way to identify fraudsters."