President Bush nominated U.S. Rep. Christopher Cox (R-CA) to head the Securities and Exchange Commission a day after William Donaldson announced his resignation. Cox, 52, became the first chairman of the Homeland Security Committee earlier this year and is a member of the House Republican leadership.
At a press conference, Cox called the Wall Street regulator one of the best-run agencies in the federal government and emphasized that fraud and unfair dealing are the natural enemies of the U.S. economy. He will replace Donaldson, the SEC chief since 2003, when he steps down June 30.
Cox has a wide-ranging background, from foreign policy and economic issues to homeland security. He has maintained close ties to business groups and has been a strong proponent of cutting the estate tax and capital gains taxes.
Cox has represented California in Congress for 16 years. Before that, he was a corporate finance lawyer in private practice and served as a senior counsel in the Reagan White House.
Donaldson came to the SEC in 2003 after the controversial tenure of Harvey Pitt, who had been a lightning rod for critics who accused him of being too cozy with the accounting firms he was supposed to be overseeing. Donaldson was widely seen as a strong and aggressive reformer, but many of his policies proved deeply unpopular with business leaders.
Donaldson — a former head of the New York Stock Exchange and co-founder of the Donaldson, Lufkin & Jenrette investment banking firm — came to the commission at a time when investor confidence had been badly shaken by the corporate scandals at Enron and WorldCom.
Donaldson was a big supporter of the Sarbanes-Oxley Act of 2002, which imposed a strict new set of regulations on the way publicly traded companies are audited and managed. Many business leaders have pressured the SEC to water down the regulations, complaining the rules have been onerous and expensive. At a news conference Wednesday, Donaldson denied that the opposition he's encountered had played a part in his decision to leave.
Scott Horsley contributed to this report.
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