WASHINGTON — President Barack Obama has chosen Elisse Walter, one of five members of the Securities and Exchange Commission, to head the agency. Chairwoman Mary Schapiro will leave next month after a tumultuous tenure in which she helped lead the government's regulatory response to the financial crisis.
Walter will take over at a critical time for the SEC, which is finalizing new rules in response to the 2008 crisis. She can serve through 2013 without Senate approval because she's already been confirmed to the commission.
Obama will need to nominate a permanent successor before Walter's term ends in December 2013. News reports have suggested that Mary John Miller, a top Treasury Department official, might be a potential candidate.
Walter, 62, a Democrat, was appointed to the SEC in 2008 by President George W. Bush. Earlier, she was a senior official at the Financial Industry Regulatory Authority, the securities industry's self-policing organization. She served under Schapiro at FINRA, who led that group before becoming SEC chairwoman in January 2009.
"I'm confident that Elisse's years of experience will serve her well in her new position," Obama said in a statement.
Walter is likely to follow the path Schapiro established at the SEC, experts suggested.
At FINRA, Walter was Schapiro's "right-hand person," said James Cox, a Duke University law professor and expert on securities law. Cox said he wasn't surprised that both of Obama's choices to lead the SEC have come from an industry self-regulatory organization. The Obama administration "is not an eager regulator of the securities markets," he said.
Still, Schapiro's challenges have probably been the most difficult any SEC chief has faced, said John Coffee, a professor of securities law at Columbia University. Schapiro took office after the Bernard Madoff Ponzi scheme and the financial crisis had eroded public and congressional confidence in the SEC. She "has to be commended for working incredibly hard and against high odds" to maintain the agency's budget, Coffee added. Still, the agency is "underfunded and overworked, and that's not about to change."
Schapiro, 57, will leave the SEC on Dec. 14.