Mary Schapiro, seeking to win Senate confirmation to be chairman of the U.S. Securities and Exchange Commission, said she will "reinvigorate" an enforcement unit that has drawn fire from lawmakers for missing Bernard Madoff's alleged $50 billion Ponzi scheme, Bloomberg reported.
"I will move aggressively to reinvigorate enforcement," Schapiro told the Senate Banking Committee today. "We need an SEC that is the investor's advocate -- that has the staff, the will and the resources necessary to move with great urgency."
Schapiro, 53, must restore the SEC's credibility and overcome questions about why her current employer, the Financial Industry Regulatory Authority, also missed signs that Madoff's money-management business was a fraud. Washington-based Finra is a non-government regulator that inspects and has authority to impose sanctions on more than 5,000 U.S. brokerages.
Schapiro faces "an immense challenge and that probably understates it," said Donald Langevoort, a former SEC attorney who teaches securities law at Georgetown University in Washington. "She has to restore morale at the commission. She has to deploy resources to brand new problems at the same time she's looking backward at a mess that is still lying on the floor."
The SEC's enforcement staff, which is responsible for investigating and prosecuting fraud, peaked in fiscal 2005 at 1,232 full-time employees, according to agency budget requests. The SEC expects to finish the fiscal year ending in September with 1,093 full-time enforcement workers.