WASHINGTON — Christopher Cox, right, has stepped down as Securities and Exchange Commission chairman, leaving behind a demoralized agency that failed to spot Bernard Madoff’s alleged fraud and had its role diminished by the collapse of Bear Stearns and Lehman Brothers.
His resignation took effect Tuesday. During Cox’s 3 1/2-year tenure, the SEC has been criticized by lawmakers, investors and its own inspector general as lacking aggressiveness and being deferential to Wall Street banks.
President Barack Obama, a Democrat, picked Mary Schapiro, head of the U.S. brokerage industry’s self-regulator, to succeed the Republican Cox.
“I respect Chris Cox, but there’s no question that the commission has been much too passive in area after area under his leadership,” said Harvey Goldschmid, a former Democratic SEC commissioner.
Under Cox, public fights among Democratic and Republican commissioners stopped and enforcement penalties declined. Cox’s focus on calming the waters stoked concerns that the SEC had become inactive just as Wall Street’s biggest companies were increasing trading in derivatives and complex securities backed by mortgages, said Robert Hillman, who teaches securities law at the University of California, Davis. Bloomberg News; AP file photo
