SEC

Senator Vitter to block SEC nominees

Reuters News
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Posted: Jun 14, 2011 1:38 PM
Senator Vitter to block SEC nominees

By Dave Clarke and Sarah N. Lynch

WASHINGTON (Reuters) - Senator David Vitter plans to at least temporarily block the confirmation of two nominees to the Securities and Exchange Commission, his office said on Tuesday.

Vitter, a Republican, is concerned with the agency's handling of Texas financier Allen Stanford's alleged Ponzi scheme.

Once the SEC issues a recommendation on whether Stanford's alleged victims will be compensated by an industry-backed fund, Vitter would release his hold on SEC commissioner nominees Luis Aguilar and Daniel Gallagher, his office said.

The SEC has said publicly it plans to issue a decision soon, but nothing has been announced and Vitter said he is frustrated with delays at the SEC.

Vitter's announcement came after the conclusion of Aguilar and Gallagher's confirmation hearing before the Senate Banking Committee on Tuesday.

At the hearing, there were no indications of major resistance to the nominees. Both Senate Banking Chairman Tim Johnson and Ranking Republican Richard Shelby said they are hoping for a speedy confirmation. Vitter was not present at the hearing.

Aguilar, a Democrat, has been serving as a commissioner at the SEC since 2008, filling a partial term. Daniel Gallagher, a Republican, is currently a partner at law firm Wilmer Cutler Pickering Hale and Dorr, and previously worked at the SEC in different capacities from 2006 through 2010.

If confirmed, Gallagher would replace Republican SEC Commissioner Kathleen Casey, whose 5-year term expires this year.

Vitter, a Senate Banking Committee member, has been vocal about his concerns the SEC missed the alleged Stanford fraud and about delays in whether Stanford Ponzi scheme victims should have their claims covered by the Securities Investor Protection Corp, or SIPC.

The SIPC has said the investors in this case are not eligible for coverage, but the investors have taken their concerns to the SEC and asked the agency to weigh in.

"We've known for some time that the SEC waited far too long to take action against Allen Stanford, and now they're dragging their feet in responding to the victims," Vitter said in a statement. "I will continue to hold them accountable -- including holding these nominations -- until these fraud victims get an up-or-down answer from the SEC on SIPC."

(Reporting by Dave Clarke and Sarah N. Lynch; editing by Maureen Bavdek and Andre Grenon)