President-elect Barack Obama has appointed seasoned economic expert Mary Schapiro as the next head of the financial watchdog, the Securities and Exchange Commission. Criticised heavily for its failure to protect investors in the current world crisis, Schapiro is expected to see a major overhaul of the agency.
President-elect Barack Obama said: ‘‘A massive fraud that was made possible in part because the regulators who were assigned to oversee Wall Street dropped the ball. And if the financial crisis has taught us anything it’s that this failure of oversight and accountability doesn’t just harm individuals involved, it has the potential to devastate our entire economy, and that’s a failure we can’t afford. Financial regulatory reform will be one of the top legislative priorities of my administration.’‘
Much of the criticism levelled at the SEC centres on the alleged multi-billion euro fraud by Bernard Madoff. Staff at the regulator have been accused of repeatedly failing to investigate warnings over a ten year period about the disgraced Wall Street investment manager. An investigation has been launched by the agency’s Inspector General into what went wrong.