Search Is On For SEC Successor To Pitt

By Agence France-Presse Business leaders and investors celebrated, and the search for a successor began Nov. 6 after the chief U.S. corporate crime fighter, Harvey Pitt, quit over a series of gaffes. Pitt offered his resignation as chairman of the Securities and Exchange Commission (SEC) late Nov. 5. The announcement, given on the night President George W. Bush's Republican Party won power over both houses of Congress, left the SEC rudderless as it seeks to restore shattered investor confidence in Wall Street. But the departure of the 57-year-old former lawyer, his credibility in tatters, was widely welcomed. "We need rule-making. What we've got, unfortunately, is distraction after distraction," says U.S. Chamber of Commerce Executive Vice President Bruce Josten. Uncertainty created by Pitt's missteps had hindered corporate decision-making, he claims. Pitt's resignation removed a cloud hanging over the equity markets, says Salomon Smith Barney analyst Tobias Levkovich. "In many respects, this will be viewed as constructive for stocks, in our opinion, as there likely will be a perception that greater clarity and transparency in the U.S. markets will be more forthcoming under someone other than Pitt," Levkovich says. A series of miscalculations dogged Pitt's career at the SEC, overshadowing achievements in the battle against the corporate scandals that have erupted since the collapse of energy giant Enron Corp. last year. Under Pitt's turbulent 15-month tenure at the top, the SEC introduced a rule that chief executives must swear to the accuracy of their company accounts. But Pitt never managed to shake off suspicions that he was too close to the accountancy industry. The final blow came when Pitt mishandled the appointment of a new man -- former Central Intelligence Agency chief William Webster -- to lead a panel to supervise the accounting industry. Successors already being touted in the press to lead the SEC include former New York Mayor Rudolph Giuliani, who battled boardroom crime as a federal prosecutor. The Chamber of Commerce said it would welcome Giuliani. "I hear Giuliani's name every day," says Josten. "He's somebody who has got a proven capacity to lead. Copyright Agence France-Presse, 2002

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