- The Washington Times - Thursday, November 14, 2002

The outgoing chairman of the Securities and Exchange Commission says the work of a special accounting-oversight board won't be impeded by the resignation of former FBI Director William Webster.
"The work of the board is going to go on, and it's going to be effective," Harvey Pitt, who resigned Nov. 5, told reporters yesterday.
Mr. Webster was caught in controversy about his selection by the SEC to head the new board, a debacle that already had prompted the resignations of Mr. Pitt and the SEC's chief accountant.
Mr. Webster's resignation was announced Tuesday, one day before the oversight board was scheduled to have its first meeting.
Mr. Webster declined to blame Mr. Pitt for not informing fellow SEC commissioners that Mr. Webster had headed the audit committee of a company under investigation for fraud and had fired the company's outside auditors. But he acknowledged that the information should have been shared. Mr. Pitt, a Bush appointee, resigned a week ago because of that.
"I don't want to put any responsibility" on Mr. Pitt, Mr. Webster said on CNN's "Moneyline" program. "I disclosed a possible problem, and they said they'd look into it, and they did. But I had no knowledge of what they might decide to do about it."
Asked whether he would agree that the commissioners should have been told, Mr. Webster replied: "I think it would help even if the information, in the opinion of those who looked at it, was as unimportant as it appeared to be in my case because you never know."
In a resignation letter to Mr. Pitt, Mr. Webster, who also once headed the CIA, said he believed his continued presence on the board "will only generate more distractions, which will not be helpful to the important mission of the board."
"Those who know me will appreciate that I do not abandon duty lightly. It is time to clear the air," he wrote.
Mr. Pitt, whose 15-month tenure has been marked by a series of political missteps, has remained in office pending President Bush's naming a replacement to be confirmed by the Senate.
Mr. Pitt is facing investigations into whether he concealed from other SEC members Mr. Webster's role for a company that is under investigation. The SEC voted 3-2 to appoint him on Oct. 25. Mr. Pitt and the other two Republicans approved Mr. Webster, and the two Democrats opposed him.
The turmoil comes at a time when the government is trying to bolster the confidence of investors and consumers shaken by corporate scandals during the past year and the SEC is investigating questionable accounting at dozens of companies.
Creation of the oversight board was mandated by Congress during the summer in legislation responding to the wave of accounting scandals at Enron Corp., WorldCom Inc. and other big companies. The five-member board, to be independent of the accounting industry, will be armed with subpoena authority and disciplinary powers and financed by fees from publicly traded companies. Each board member will be paid about $400,000 a year.
The SEC inspector general and Congress' auditing arm, the General Accounting Office, are investigating the circumstances surrounding Mr. Webster's appointment, and the Senate Banking, Housing and Urban Affairs Committee plans hearings.

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