U.S. Securities and Exchange Commission Chairman Harvey Pitt resigned Tuesday, following a week in which scandal once again dogged the oft-criticized official.
A White House spokesman confirmed that Pitt sent a letter of resignation to President George W. Bush Tuesday afternoon, which Bush accepted. The administration had no immediate comment on a nominee to succeed Pitt, or when a successor would be named, the spokesman said.
Pitt cites the “turmoil” surrounding his chairmanship in the brief letter, a copy of which was provided by the White House.
“Rather than be a burden to you or the agency, I feel it is in everyone’s best interest if I step aside now, to allow the agency to continue the important efforts we have started,” the letter said.
Pitt, an attorney who previously counted among his clients many of the firms he was later charged with regulating as head of the SEC, was frequently attacked by critics for perceived conflicts of interest. His handling of the wave of accounting scandals roiling Wall Street, including the collapses of Enron and WorldCom, also drew censure from an array of politicians and officials.
In response to the cases of corporate fraud that have come to light, the U.S. Congress moved to create a new accounting oversight board, the members of which are to be appointed by the SEC. But that board created a fresh wave of scandal this week, as the SEC’s chosen head for the group, William Webster, turned out to have until recently chaired the audit committee of a company now facing fraud charges.
Pitt knew of Webster’s service on the board of U.S. Technologies and of the charges against top executives of the nearly bankrupt company, but did not disclose that information to other SEC commissioners before they voted on Webster’s nomination. The questions about Webster resulted in an internal SEC investigation into the process behind his selection, and renewed calls for Pitt’s ouster.
