Biden wants to nominate Gary Gensler as US SEC chairman, sources say


WASHINGTON (Reuters) – Gary Gensler will be appointed chairman of the US Securities and Exchange Commission (SEC) by President-elect Joe Biden, two sources familiar with the matter have said.

FILE PHOTO: Gary Gensler, Chairman of the Commodity Futures Trading Commission, testifies at a Senate Committee on Banking, Housing and Urban Affairs Committee hearing on Capitol Hill July 30, 2013. REUTERS/Jose Luis Magana/File Photo

Gensler served as chairman of the Commodity Futures Trading Commission (CFTC) from 2009 to 2014 and has led Biden’s transition plan for financial industry oversight since November.

His appointment as the country’s top securities regulator is expected to put an end to the four years of rule relaxation that banks, brokers, funds and public companies have experienced on Wall Street under President Donald Trump’s SEC Chairman Jay Clayton.

At the CFTC, Gensler introduced dramatic new swap trading rules mandated by Congress in the wake of the 2007-2009 financial crisis and developed a reputation as a hard-nosed operator willing to oppose powerful Wall Street interests.

A former Goldman Sachs banker and MIT Sloan School of Management professor, Gensler also oversaw the prosecution of major investment banks for manipulating Libor, the benchmark for global trillion-dollar lending.

Gensler did not respond to a request for comment. A Biden spokesman did not immediately respond to a similar request.

HARD LINE ON ENFORCEMENT

Progressives should cheer the appointment.

Gensler is expected to take a tough line on enforcement and follow rules that address Democratic policy priorities around issues like climate change and social justice.

In particular, policy experts expect Gensler to follow new corporate disclosures on risks related to climate change, political spending, and the composition and treatment of its workforce. Democrats are also keen to lift new protections for investment advice that they say do more harm than good, restore some shareholder rights and complete post-crisis executive pay caps.

“The agency’s leadership will set an agenda in the opposite direction that Jay Clayton and congressional Republicans have been steering for years, by expanding and improving industry disclosure and restoring investor rights,” said Ty Gellasch, head of Washington-based, healthy markets.

The former Wall Street attorney, incumbent Clayton, has been criticized by Democrats for his extensive ties to many of the companies he is tasked with overseeing and his ambitious agenda to end a 20-year decline in US public company listings by a Reverse revision of dozens of rules.

Among the most controversial changes were measures that critics said reduced companies’ disclosures to investors, weakened the independence of auditors, made it harder for shareholders to push for corporate votes on issues such as climate change and racial justice, and allowed more retail investors to participate in investments by private companies .

Clayton said his changes maintained key investor and market protections, and his tough stance on fighting cryptocurrency scams and offerings was praised by consumer groups. But consumer and investor groups said his changes too often made life easier for companies by weakening investor protections or reducing investors’ rights.

“The good news is that much of this action came late enough in his tenure that it may still be possible to reverse course,” said Barbara Roper, director of investor protection at the Consumer Federation of America.

Writing by Michelle Price, editing by Rosalba O’Brien and Howard Goller

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