A new report has severely eroded the already thin credibility of the U.S. Securities and Exchange Commission and its Chair Mary Jo White, finding the head of the securities regulator “both embodies and promotes the revolving door between government regulator and regulated industry that empowers Wall Street insiders at the expense of investors and society writ large.”
The damning findings are detailed in a new report by Rootstrikers, a nonprofit organization that advocates for campaign finance reform. The report, released Tuesday, criticizes White’s work as a corporate defense lawyer, her recusals from certain SEC enforcement cases and her continued policy of hiring aides who previously worked in the securities industry.
It goes on to criticize White for letting her longstanding ties to Wall Street skew her ability to police the finance industry. The report referenced the litany of complaints by left-leaning groups about her tenure.
The attack increases pressure on White, particularly from Democrats, who are demanding the SEC impose appropriate penalties on financial firms and at the same time finally complete rules that have languished for years.
White’s sharpest critics include Massachusetts Democratic Senator Elizabeth Warren, who bluntly called her leadership “extremely disappointing.”
Responding to the straight-shooting Warren, White, in a typically tone-deaf statement, said that she is “very proud of the agency’s achievements under my leadership, including our record year in enforcement and the commission’s efforts in advancing more than 30 congressionally mandated rulemakings and other transformative policy initiatives to protect investors and strengthen our markets.”
“We wanted to put this report out and really lay out a strong case on why the Obama administration should have chosen better last time around,” said Kurt Walters, campaign manager for Rootstrikers, in reference to White’s selection. “We intend to encourage them to make the right choice this time.”
Rootstrikers began operation in 2011 and was founded by Harvard Law Professor Lawrence Lessig. It has principally been active in pushing to reform the campaign finance system in the wake of Supreme Court decisions that have resulted in corporations and union controlling virtually every politician in the country. It has more recently taken an interest in issues related to financial regulation.
One of the major regulations that both Rootstrikers and investor advocates want passed by the SEC would force companies to publicly disclose their political spending.
White has, predictably, signaled the SEC won’t act on the measure.