Securities and Exchange Commission Chair Mary Jo White announced Monday afternoon that she plans to step down from her post at the end of the Obama Administration.
White was confirmed as the 31st chairman of the SEC in April 2013.
“It has been a tremendous honor to work alongside the incredibly talented and dedicated SEC staff members who do so much every day to protect investors and our markets,” White said in a statement. “I am very proud of our three consecutive years of record enforcement actions, dozens of fundamental reforms through our rulemakings that have strengthened investor protections and market stability, and that the job satisfaction of our phenomenal staff has climbed in each of the last three years.”
White’s legacy will include completing the vast majority of the agency’s mandates under the Dodd-Frank Act and all of its mandates under the JOBS Act. Under her leadership, the Commission advanced more than 50 significant rulemaking initiatives.
“My duty has been to ensure that the Commission implemented strong investor and market protections, and to establish an enduring foundation for future progress in the most critical areas —asset management regulation, equity market structure and disclosure effectiveness,” White said. “Thanks to the hard work and dedication of the SEC’s staff, we have accomplished both.”
Chair White also, currently, serves as a member of the Financial Stability Oversight Council and on several other domestic and international organizations, including the International Organization of Securities Commissions, the Financial Stability Board, the International Financial Reporting Standards Foundation Monitoring Board, the Financial and Banking Information Infrastructure Committee, and the Federal Housing Finance Oversight Board.
“It has been and will always be critical for this agency and the public that the SEC remain truly independent,” she said. “That independence is crucial to our ability to protect investors, safeguard our markets and facilitate the capital formation that fosters innovation and the growth that is essential to our national economy.”
Prior to her arrival at the Commission, White spent decades as a federal prosecutor and securities lawyer. As the U.S. attorney for the Southern District of New York from 1993 to 2002, she prosecuted cases involving complex securities and financial institution frauds, other white-collar crime and international terrorists.
White also served as an assistant U.S. attorney and was chief appellate attorney of that office’s Criminal Division. She served as acting U.S. attorney for the Eastern District of New York as well as the first assistant U.S. attorney.
In private practice, White was a litigation partner and chair of the litigation department of Debevoise & Plimpton, overseeing more than 200 lawyers.
Accompanying her announcement, the SEC has issued a tally of White’s accomplishments. Among them:
Adopting rules to fundamentally change the way money market funds operate to address risks of investor runs, as experienced during the financial crisis;
Rules to require sweeping enhancements to liquidity risk management by open-end funds, including mutual funds and exchange-traded funds;
Rules to modernize and enhance the reporting and disclosure of information by registered investment companies;
Rules to improve the quality and accessibility of information reported and disclosed by investment advisers
Proposed rules to modernize and enhance the regulation of the use of derivatives by mutual funds and other registered investment companies
Proposed rules to require registered investment advisers to adopt and implement written business continuity and transition plans and provided guidance to investment companies on business continuity planning;
Regulation Systems Compliance and Integrity (Regulation SCI), which mandates comprehensive new controls to strengthen key technological systems, promoting greater transparency, resiliency, and accountability;
Adopting the Volcker Rule in coordination with banking regulators and the CFTC, which restricts banking entities, including bank-affiliated, SEC-registered broker-dealers, security-based swap dealers, and investment advisers, from engaging in proprietary trading, sponsoring hedge funds and private equity funds, or investing in such funds;
Rules for additional safeguards with respect to custody of customer securities and cash by broker-dealers;
Rules amending the financial responsibility framework for broker-dealers to enhance protections for customer assets, firm capital requirements, and risk management controls;
Adopting rules requiring broker-dealers, mutual funds and investment advisers to adopt programs to detect red flags and prevent identity theft;
Proposed jointly with the FDIC rules governing the orderly liquidation of certain large broker-dealers;
Adopted a comprehensive package of reforms for the regulation and oversight of credit rating agencies, including new controls on the management of conflicts of interest;
Rules to establish enhanced standards for the operation and governance of securities clearing agencies that are deemed systemically important or that are involved in complex transactions, such as security-based swaps;
Proposed applying enhanced standards for operation and governance to other categories of securities clearing agencies, including all SEC-registered central counterparties;
Proposed a rule amendment to shorten the standard settlement cycle for most broker-dealer securities transactions from three business days after the trade date (T+3) to two business days after the trade date (T+2);
Adopting foundational cross-border rules for security-based swap entities, including rules regarding the use of U.S. personnel by non-U.S. companies, and proposed a comprehensive ruleset for the cross-border application of all security-based swap regulations;
Adopting rules to require security-based swap data repositories to make data available to regulators and other authorities, allowing them to share information and more effectively oversee the security-based swap market;
Rules for the registration of security-based swap dealers and major security-based swap participants;
Adopted rules implementing a comprehensive set of business conduct standards and chief compliance officer requirements for security-based swap entities;
Proposed rules establishing recordkeeping and reporting requirements for security-based swap entities;
Published a concept release discussing and seeking public comment on modernizing certain business and financial disclosure requirements in Regulation S-K;
Published a request for comment on disclosure requirements in Regulation S-K relating to management, certain security holders, and corporate governance matters;
Published a request for comment on the financial disclosure requirements in Regulation S-X for certain entities other than a registrant;
Published a concept release seeking public comment on potential ways to improve current audit committee disclosure requirements;
Adopted rules to require resource extraction issuers to disclose payments made to governments for the commercial development of oil, natural gas or minerals;
Proposed rule and form amendments that would require registrants to include hyperlinks to exhibits in their filings;
Proposed amendments to eliminate redundant, overlapping, outdated, or superseded provisions in light of subsequent changes to technology, accounting standards and Commission disclosure requirements;
Adopted an interim final rule to allow Form 10-K filers to provide a summary of the business and financial information contained in the annual report;
Adopted wide-ranging rules to enhance transparency and better protect investors in the asset-backed securities market;
Adopting rules for credit risk retention, which require securitizers of asset-backed securities to keep “skin in the game” for the securities they package and sell, as part of a joint rulemaking with five other federal agencies;
Adopting rules requiring a company to disclose its “pay ratio” – the ratio of compensation of its chief executive officer to the median compensation of its employees;
Proposed rules to require companies to disclose the relationship between compensation actually paid to executives and the financial performance of the company;
Proposed rules directing national securities exchanges and associations to establish listing standards requiring companies to adopt policies that require executive officers to pay back incentive-based compensation that they were awarded erroneously;
Proposed rules to enhance corporate disclosure of hedging policies for officers, directors and employees;
Re-proposed rules with five other federal regulators that would require enhanced reporting of, and impose new restrictions and prohibition on, incentive-based compensation at financial institutions;
Adopting rules to increase access to capital for smaller companies by enhancing the Regulation A exemption to enable companies to offer and sell up to $50 million of securities each year;
Adopting rules to permit companies to offer and sell securities through crowdfunding and to create a regulatory framework for broker-dealers and funding portals that facilitate crowdfunding transactions and protect investors;
Rules to allow general solicitation for certain offers and sales made under Rule 506 and proposed rules to enhance the Commission’s ability to assess the development of market practices in Rule 506 offerings;
Adopting rules that would amend existing Securities Act requirements to facilitate intrastate and regional securities offerings;
Proposed amendments to the proxy rules to require parties in a contested election to use universal proxy cards that would include the names of all board of director nominees.
Under White’s watch, the Commission has focused its enforcement efforts on key areas of growing concern, including financial reporting and accounting fraud, improper conduct by key market participants, and illegal practices by broker-dealers and investment advisers. The Commission has also continued to bring important cases involving other enforcement priorities, including insider trading, Foreign Corrupt Practices Act violations, and misconduct related to complex financial instruments.
Those efforts yielded a record-setting number of enforcement actions. From April 2013 through September 2016, the Commission brought more than 2,800 enforcement actions, over 1,650 of which were independent or standalone actions. In fiscal year 2016 alone, the Commission brought 548 standalone actions, a record number, plus 320 additional follow-on and delinquent filing actions. The Commission also obtained orders for disgorgement and penalties of more than $4 billion. The agency charged more than 250 individuals in insider trading actions between April 2013 and September 2016.
During White’s tenure, more than $100 million to 34 whistleblowers who provided key original information that led to successful enforcement actions. The Commission also brought the first-ever action applying the Dodd-Frank Act whistleblower anti-retaliation authority against a firm for retaliating against a whistleblower who reported a possible securities violation to the Commission and brought the first stand-alone action for retaliation against a whistleblower. Another accomplishment: the first-ever action against a company, KBR Inc., for using improperly restrictive language in confidentiality agreements with the potential to stifle the whistleblowing process
White oversaw the creation of a new Office of Risk Assessment within the Division of Economic and Risk Analysis to centralize DERA’s ongoing work in risk assessment activities. Other efforts led to the development of data-driven analytical tools, including: the Corporate Issuer Risk Assessment dashboard, which assists in identifying anomalous patterns in financial reporting that may warrant further inquiry; the Broker-Dealer Risk Assessment tool, which identifies outlier behavior that allows OCIE to prioritize inspections and focus the attention of examiners where they are most likely to detect inappropriate risk or fraudulent activity; and the Investment Company Risk Assessment tool, which seeks to detect anomalous investment company characteristics and activities.