Obama names 3 financial watchdogs
President-elect picks chiefs of the SEC and Commodity Futures Trading Commission, and fills a Federal Reserve Board seat.
NEW YORK (CNNMoney.com) -- President-elect Obama on Thursday kept up his blistering pace of naming top officials by announcing three people he will nominate as financial regulators.
During a press conference in Chicago, he said that "creating a regulatory structure that prevents broad systemic risk" will be a top priority in his administration.
"We have been asleep at the switch," Obama said, referring to the failure of regulators, lawmakers and White House officials to foresee the systemic meltdown that has battered the economy and financial markets.
One of his administration's early initiatives, Obama said, would be to streamline regulatory agencies and reform financial to better address 21st century developments in the financial markets.
Obama promised to "restore a sense of responsibility" to Wall Street and Washington so traders, regulators, shareholders and others "operate out of a sense for the common good," while at the same time ensuring conditions are conducive for both Wall Street and Main Street to prosper.
To help him execute his regulatory goals, Obama named Mary Schapiro to head the Securities and Exchange Commission, which regulates companies with publicly traded securities. Schapiro currently is chief executive of the Financial Industry Regulatory Authority, the largest non-government regulator for securities firms that do business with the U.S. public.
Obama's announcement comes on the heels of growing criticism that the SEC failed to act on information it had that could have prevented one of the largest investment fraud cases in history.
"We'll ensure openness, accountability and transparency in our markets," Obama said at a press conference in Chicago. "And instead of appointing people with disdain for regulation, I will ensure that our regulatory agencies are led by individuals who are ready and willing to enforce the law."
Schapiro has a long track record as a financial regulator during the Reagan, Bush and Clinton administrations. She headed the Commodity Futures Trading Commission during the Clinton administration and the National Association of Securities Dealers in 2006. She also briefly served as the SEC's acting chair in 1993, and had been a commissioner there for six years before that.
Obama also tapped Gary Gensler to chair the Commodities Futures Trading Commission, which regulates the futures and options markets and ensures fair trading practices.
Gensler, a former partner at Goldman Sachs, was the Treasury's assistant secretary for financial markets during the Clinton administration. He also served as an adviser to Hillary Clinton's presidential exploratory committee and before that was senior adviser to Sen. Paul Sarbanes, chairman of the Senate Banking Committee who was instrumental in getting a law passed in the wake of the Enron scandal to create more transparency in corporate accounting.
Co-author of "The Great Mutual Fund Trap," Gensler was a vocal critic of mutual funds' fees and the undisclosed incentives brokers had to sell them. He blamed the SEC for lax oversight of the industry.
Earlier this year, the CFTC was blasted by Democratic lawmakers and others for not taking a stronger hand with oil speculators and for brushing aside the theory that oil speculation unduly pushing oil prices to record highs earlier this year.
Finally, Obama named Georgetown law professor Dan Tarullo to fill a vacant seat on the Federal Reserve Board of Governors, which among other things determines monetary policy for the country and is making unprecedented moves to curtail the country's financial crisis.
Tarullo, whose specialty is international economics and banking, held several senior posts in the Clinton administration, ultimately becoming the assistant to the president for international economic policy. He also served as an economic adviser during Obama's election campaign.
During his term, Obama will have the opportunity to make at least two more appointments to the Fed's seven-member board.