Senate Minority Leader Harry Reid has asked President Bush to reappoint Roel C. Campos as a commissioner to the Securities and Exchange Commission and to nominate Annette L. Nazareth for a seat on the five-member commission.
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The Nevada Democrat recommended them to fill seats for Democrats at the SEC in separate letters sent to the president, which were released Wednesday. Campos' term expires June 5, but under SEC rules, he is permitted to stay in that post through the end of the congressional session that follows the current session. He became a member of the SEC in August 2002. Reid's letter comes as Campos has agreed to speak at the National Association of Bond Lawyers' Bond Attorneys' Workshop on Sept. 15 in Chicago.
Nazareth is currently director of the commission's market regulation division, a post she has held since March 1999. She joined the SEC in October 1998. She would succeed Harvey J. Goldschmid, whose term expired June 5 last year. Goldschmid could remain at the SEC through the end of the year, but he has told colleagues that he wants to return to teach at Columbia University School of Law in September.
SEC observers do not expect Bush to act on the recommendations any time soon, because if Goldschmid or Campos leaves, they and SEC chairman William H. Donaldson, a Bush appointee, would no longer be able to obtain a majority vote for key regulatory reforms over the Republicans, Cynthia A. Glassman and Paul S. Atkins.
Republicans and conservative groups have been upset that Donaldson has sided with the Democrats to vote for controversial regulatory reforms involving mutual funds, hedge funds, and the structure of the securities market.
Senate Banking Committee chairman Richard Shelby, R-Ala., asked Donaldson at a hearing yesterday whether the 3-to-2 votes to approve rules weaken those regulations.
"There's a trade-off between reaching a consensus and reaching a decision," Donaldson said. He told committee members that almost all of the commission votes during his tenure have been unanimous.
But Sen. Mike Crapo, R-Idaho, said that recently a lot of controversial rules have been approved 3 to 2. "The lack of consensus at the commission is getting to be disturbing."
Donaldson responded that the SEC has "a very open and fair process" that permits a great deal of debate and discussion before votes on rules occur. However, he added, the tendency for those opposed to certain rules to issue minority dissents after they are approved by 3-to-2 votes undermines the process.
"There's a follow on of minority dissent, which could have been brought out in open debate," Donaldson said. "I think that is seriously a wrong direction." (c) 2005 The Bond Buyer and SourceMedia, Inc. All rights reserved. http://www.bondbuyer.com http://www.sourcemedia.com
