Ex-U.S. Attorney White Said to Be Weighed for SEC Chairman
Mary Jo White, the former U.S. attorney in Manhattan, is under consideration to become the next chairman of the Securities and Exchange Commission, three people with knowledge of the matter said.
White, now a partner at law firm Debevoise & Plimpton LLP in New York, would succeed Elisse Walter, who took over as SEC chairman last month, said the people, who asked not to be named because the matter isn’t public.
The choice of White, who was known as a no-nonsense prosecutor, would be a departure for the agency which has tended to be run by lawyers steeped in financial policy-making and the securities industry. Her relative inexperience in those areas, along with her work defending corporate clients including Ken Lewis, the former chief executive officer of Bank of America Corp. (BAC), is likely to draw fire from some lawmakers and advocates for investors.
As U.S. attorney for the Southern District of New York from 1993 to 2002, White became a leading terrorism prosecutor, winning the conviction of four followers of Osama bin Laden for the 1998 bombings of two U.S. embassies in Africa. Under her direction, prosecutors won convictions for the 1993 World Trade Center bombing and a failed plot to blow up the United Nations headquarters and other New York landmarks. During that time, she supervised Robert Khuzami, the SEC’s outgoing enforcement director, and George Canellos, his deputy.
SEC spokesman John Nester declined to comment on her possible nomination. White didn’t respond to an e-mail seeking comment.
White, who was also on the board of the Nasdaq Stock Market, could also face questions over some of her clients. She represented Ken Lewis, the former chief executive officer of Bank of America Corp., during an SEC probe of claims the bank didn’t disclose bonuses that Merrill Lynch & Co. paid to executives before buying the brokerage. The SEC didn’t accuse Lewis of wrongdoing; the bank settled the claims for $150 million.
White was also hired in 2011 by News Corp. (NWSA) to defend its independent directors against claims related to the company’s role in phone hacking by its former News of the World tabloid.
In recent years, the SEC has been faulted by lawmakers, judges and investors for failing to bring more cases related to the financial market turmoil of 2008. White said last year that prosecutors shouldn’t allow public anger to influence investigations.
“You should be aggressive where there is a crime,” she said at a New York University School of Law event in February 2012. Prosecutors must not “fail to distinguish what is actually criminal and what is just mistaken behavior, what is even reckless risk-taking, and not bow to the frenzy.”
White also surfaced in an SEC controversy in when she worked on behalf of Morgan Stanley (MS) to vet John Mack as a new CEO of the investment bank. White sought information in 2005 from then-SEC enforcement director Linda Thomsen about what an SEC insider-trading probe of Mack and hedge-fund manager Pequot Capital Management Inc. revealed about Mack’s involvement.
An SEC inspector general’s report issued in 2008 questioned whether Thomsen should have shared information about a potential target with White. The SEC later informed Mack and Pequot that it had closed the investigation and wouldn’t pursue any action against them.
Former SEC chairman Mary Schapiro stepped down from the top job last month and was succeeded by Walter, who spent the past four years as an SEC commissioner. Walter was able to become chairman without going through a second Senate confirmation and can stay in the job as long as the end of this year.
White’s husband, John W. White, was head of the SEC’s division of corporation finance, which is responsible for disclosure policies, under Republican SEC chairman Christopher Cox from 2006 to 2008. He’s now a partner at law firm Cravath Swaine & Moore LLP.
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