Bracing for tougher enforcement of rules governing Wall Street in President Obama's second term, several business groups warily welcomed the president's nomination Thursday of Mary Jo White, a former U.S. attorney for Manhattan who made her name prosecuting terrorists, to head the Securities and Exchange Commission.
Mrs. White, a partner at the law firm of Debevoise & Plimpton LLP in New York, served during the Clinton administration as U.S. attorney for the Southern District of New York, overseeing a string of high-profile white-collar crime cases. If confirmed by the Senate, she would succeed Elisse Walter, who took over as acting SEC chairman when Mary Schapiro stepped down last month.
Mr. Obama named Mrs. White and renominated Richard Cordray as director of the new Consumer Financial Protection Bureau (CFPB) Wednesday afternoon during a brief ceremony in the White House, saying both are needed to complete the financial regulatory overhaul begun in the president's first term.
"There's much more work to be done to complete the task of reforming Wall Street," Mr. Obama said, urging the Senate to confirm her as soon as possible. "We need to keep going after irresponsible behavior in the financial industry so that taxpayers don't pay the price."
The president also praised Mr. Cordray for his work at the CFPB over the past year and noted that his term will be up by the end of the year if the Senate does not confirm him.
Mr. Obama placed him in the job last year with a much-contested recess appointment. Republicans had blocked the nomination because they generally opposed the agency's creation and wanted changes to the agency's funding and structure.
The appointment of the 65-year-old Mrs. White, a tough former federal prosecutor, to head the SEC is an unusual step. The agency is usually run by lawyers and policy specialists who have spent years dealing with the securities industry.
At least one leading business group praised President Obama's choices.
"Both have the experience and knowledge to deal with the challenges and issues facing their respective agencies," said Scott Talbott, senior vice president for public policy at the Financial Services Roundtable.
But some were privately questioning Mrs. White's background as a prosecutor, expressing concern that she will aggressively crack down on businesses following the 2010 passage of the Dodd-Frank financial regulatory law.
"We don't mind being prosecuted if we do something wrong," a financial services executive told The Washington Times on background. "But if all she's doing is prosecuting for the sake of prosecuting, then that's a problem."
Although she prosecuted several high-profile white-collar criminals, Mrs. White is perhaps best known for winning convictions of four followers of Osama bin Laden for the 1998 bombings of two U.S. embassies in Africa. She also successfully prosecuted the 1993 World Trade Center bombing.
The U.S. Chamber of Commerce generally praised Mrs. White's appointment, noting only that the SEC has struggled under a heavy workload in recent years — from "the size and scope" of the Dodd-Frank-mandated rules to implementing new measures in the so-called "Jobs Act" approved by Congress last year aimed at making it easier for companies to go public more quickly and raise money.
David Hirschmann, president of the Chamber's Center for Capital Markets Competitiveness, expressed concerns about Mr. Cordray's renomination, although he noted that he has appreciated Mr. Cordray's willingness to listen to the concerns of all interested parties over the past year.
"We still have serious concerns about the [CFPB]'s structure, methods and policies, so we hope the Senate will take advantage of the confirmation process — the only meaningful check on the bureau's authority — to get clear answers on how the $500 million agency is working," he said.
Sen. Richard C. Shelby, Alabama Republican and ranking member on the Senate's banking committee, which will hold hearings for Mrs. White and Mr. Cordray, said that he also has concerns about the new agency and that his opposition to Mr. Cordray's nomination hadn't changed from two years ago.
Other senators on the banking committee said they plan to question Mrs. White about how her experience as a federal prosecutor will affect her role at the SEC.
Sen. Jon Tester, Montana Democrat, said he is particularly concerned about how she will implement the Jobs Act.
"At a time of great economic potential, too many new businesses and entrepreneurs are waiting for this bipartisan law to be fully implemented," he said.
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