- The Washington Times - Tuesday, December 10, 2002

President Bush selected former investment banker William H. Donaldson to head the Securities and Exchange Commission and to restore confidence in markets shaken by a wave of corporate financial scandals.

His mission, as outlined by Mr. Bush today: "to vigorously enforce our nation's laws against corporate corruption."

Standing beside Mr. Bush at the White House announcement, Mr. Donaldson took up the gauntlet. "As my mother used to say many years ago, it's time for all of us to pull up our socks."

Mr. Donaldson will replace Harvey Pitt, who resigned last month under pressure over his handling of the financial debacle at Enron and other large corporations. The president said his administration also plans to boost the SEC's budget to give it the resources to root out corporate malfeasance.

"Confidence in the U.S. corporate and financial industries has been seriously eroded during the past few years," Mr. Donaldson said after Mr. Bush had introduced him.

Mr. Donaldson, who helped found the investment banking firm Donaldson, Lufkin & Jenrette in 1959, would bring a long record of experience on Wall Street. He also served as chairman of the New York Stock Exchange from 1990 to 1995.

Sen. Charles Schumer, D-N.Y., a member of the Senate Banking Committee, applauded the nomination.

"The SEC desperately needs someone who both has a deep knowledge of how the markets function and at the same time possesses a rock-ribbed integrity," he said in a statement. "Bill Donaldson is such a man."

Mr. Bush tapped Mr. Donaldson one day after he nominated railroad executive John Snow to replace Treasury Secretary Paul O'Neill and lead a retooled economic team.

White House economic adviser Larry Lindsey, also fired in the economic team purge, is expected to be replaced by investor Stephen Friedman. But a final decision by Mr. Bush is pending the resolution of personal and professional issues that recently cropped up for Mr. Friedman, said White House officials. They said the delay will not hurt Mr. Friedman's prospects.

The president said his proposed increase in funding for the SEC for the 2004 budget year would almost double the agency's current resources. For the last fiscal year, which ended Sept. 30, the SEC was given $438 million. Mr. Bush's increase would bring that total to between $800 million and $850 million, said Amy Call, a spokeswoman for the White House's Office of Management and Budget.

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