Washington, Nov 22: A leading reformer in the Senate on Thursday suggested Washington directly regulate the scandal-torn New York Stock Exchange, adding to calls for the Securities and Exchange Commission to take a strong role. But the head of the SEC rejected the idea. Senator Paul Sarbanes, the Maryland Democrat who has driven the Senate’s corporate and accounting reform agenda, said at a congressional hearing the SEC could take on regulating the NYSE with a modest staff increase. Richard Shelby, the Alabama Republican who chairs the Senate Banking Committee, also called for a thorough congressional review of a plan to reorganise the NYSE, the world’s largest exchange. He described public reaction to the reform plan as “decidedly mixed” and said the proposals, drawn up by interim NYSE chairman John Reed, “may be the first step in a more lengthy reform process.”
Reed, a retired banking executive, accepted the job of reorganising the exchange after Richard Grasso resigned as NYSE chairman amid controversy over his $188m pay package. Separately, US pension fund managers and state finance chiefs stepped up their criticism of the NYSE reforms.
“The problem institutionally with the Securities and Exchange Commission is that its willingness to monitor, regulate and participate in the reform of Corporate America is spotty at best,” New York State comptroller Alan Hevesi told a press conference. “We’re calling on the SEC to do its job.” California treasurer Phil Angelides said the SEC must step up to the table and “finish the job of reform.”
Bureau Report