Harry Markopolos undresses the SEC: Is Mary Schapiro the right one for this job?

On Wednesday last week, while most of the nation was transfixed by “stimulus plan” negotiations, the U.S. House Capital Markets Subcommittee held a little-noticed hearing, featuring uber securities sleuth Harry Markopolos, that could rock U.S. securities regulation to its core.  As a financial markets player, attorney and professor for over twenty years, I have seen some amazing things in domestic and international financial markets. However . . .

Nothing in my recollection quite equals the drubbing that Markopolos unleashed on the SEC last Wednesday morning.  The first 64 pages of Markopolos’ written testimony should be required reading for every financial markets professional and, drumroll, every U.S. senator and representative with a hand in upcoming securities-market legislation.  To hear Markopolos tell it, what we need at the SEC is not more money but more brains and fewer arrogant attorneys.

Among the long list of disturbing revelations at pages 62-64 of the 375-page submission: Continue reading

Mary L. Schapiro Obama’s pick to chair SEC?

CNN is reporting this evening that two Obama team insiders have said President-Elect Obama plans to tap Mary L. Schapiro as incoming SEC Chair.  Schapiro certainly has a much stronger resume for the job than current SEC Chair Christopher Cox, having been appointed SEC Commissioner first by President Reagan in 1988.

It’s an interesting pick that should make financial markets insiders happy.  Schapiro has the disctinction of having been appointed to various roles by Presidents Reagan, George H.W. Bush, Clinton and George W. Bush.  This would make Obama’s administration her fifth consecutive call to serve.

Currently, Schapiro is CEO of FINRA.  Insights into her regulatory philosophy and thought processes can be gleaned from a speech she gave at Fordham University, in January 2002. Continue reading