WASHINGTON (Reuters) - President-elect Barack Obama has chosen Mary Schapiro, chief executive of the Financial Industry Regulatory Authority (FINRA), to become chairwoman of the U.S. Securities and Exchange Commission, a Democratic Party official told Reuters on Wednesday.
An announcement nominating Schapiro as SEC chairwoman is expected on Thursday.
Schapiro served as a SEC commissioner for six years, then became chairman of the U.S. Commodity Futures Trading Commission in 1994 during the Clinton administration.
At FINRA, Schapiro leads the largest non-governmental regulator for all securities firms doing business with the U.S. public. The group conducts examinations of securities firms, sets and enforces rules governing conduct of the industry, and administers a dispute resolution forum for investors.
Schapiro, a lawyer, is a member of the board of directors of Duke Energy Corp and Kraft Foods Inc.
If nominated by Obama and confirmed by the U.S. Senate as SEC chairwoman, Schapiro would take over an agency that has faced withering criticism in recent months.
On Wednesday, current SEC Chairman Christopher Cox, a California Republican, said he was concerned about the agency's failure to examine activities of Wall Street broker Bernard Madoff, who is accused of a $50 billion securities fraud. Madoff's activities were flagged at least as early as 1999 and repeatedly brought to the attention of SEC staff, who never recommended that commissioners take action.
Cox said he asked the agency's inspector general to probe the agency's conduct in the case.
In September, the SEC's inspector general faulted the agency for failing to adequately supervise big investment bank Bear Stearns before it collapsed.
Some lawmakers have called for a dramatic overhaul of the agency.
(Reporting by Kevin Drawbaugh and Julie Vorman; Editing by Eric Walsh)
