Senate bank panel sets confirmation hearing for SEC nominees

Reuters News
Posted: Jun 20, 2013 2:45 PM

By Sarah N. Lynch

WASHINGTON (Reuters) - The Senate Banking Committee will hold a confirmation hearing on June 27 for President Barack Obama's two nominees to serve on the U.S. Securities and Exchange Commission, the committee announced on Thursday.

Kara Stein, a Democrat, and Michael Piwowar, a Republican, would replace SEC commissioners Elisse Walter and Troy Paredes, respectively.

Stein is currently an aide to Senator Jack Reed, a Rhode Island Democrat and a senior member of the banking panel. Piwowar is chief economist for the committee, working under the panel's ranking Republican, Mike Crapo, of Idaho.

Stein and Piwowar are expected to have fairly speedy confirmations by the U.S. Senate, and neither is considered controversial.

They would join the SEC at a critical time. The agency is under the leadership of a new chair, former federal prosecutor Mary Jo White.

This week, White said the SEC would make major changes to its settlement policy by trying to require defendants in some select cases to admit wrongdoing. That is a departure from past practice, in which the SEC has routinely in most cases allowed defendants to neither admit nor deny charges.

The change comes on the heels of criticism from some federal judges who have denied or challenged settlements on the grounds they are too weak. But defense lawyers are warning the new policy may hinder the SEC's ability to reach settlements.

All settlements must be approved by the majority of the SEC's five commissioners, meaning Stein and Piwowar's votes could be crucial.

In addition, the SEC is facing a major backlog of rulemaking that needs to be completed under the 2010 Dodd-Frank Wall Street reform law, and it is under pressure to complete rules required by a 2012 law that eases securities regulations to help small businesses raise capital.

Separately, the SEC is mulling a controversial proposal to impose new regulations on money market mutual funds.

(Reporting by Sarah N. Lynch; Editing by Leslie Adler)