Is No One Untainted at the SEC?

[Timber Loftis]

Look, Webster has a great career, is a rather model citizen, and has lots to be proud of. Now, he'll have to explain to his grandkids how fraud allegations forced his resignation from the SEC, after previously being good enough to sit the federal bench and operate both the CIA and FBI. I think the ultimate reality is that the old Wall Street quid pro quo that society is currently rejecting was so commonplace that no one is untouched by the taint.

NYTimes

Webster Ends His Brief Stint on S.E.C. Oversight Board
By DAVID STOUT

WASHINGTON, Nov. 12 — William H. Webster resigned today as head of a new board overseeing the accounting profession in the midst of continuing controversy over his ties to a company under investigation for fraud.

Mr. Webster submitted his resignation to the Securities and Exchange Commission this afternoon, declaring that his continued presence "will only generate more distractions which will not be helpful to the important mission of the board."

"Those who know me will appreciate that I do not abandon duty lightly," Mr. Webster wrote in a letter to Harvey L. Pitt, the departing S.E.C. chairman.

Many critics of the way the new accounting board has been started have asserted that Mr. Webster, whatever his virtues and experience, was not the right man for the job, especially with investors' confidence dwindling in a time of slumping stocks and in the aftermath of Wall Street's corporate accounting scandals.

The departure of Mr. Webster, a former federal judge and former head of the Federal Bureau of Investigation and Central Intelligence Agency, came exactly a week after Mr. Pitt stepped down as chairman of the S.E.C. after a political firestorm developed over his selection of Mr. Webster.

"A new S.E.C. chairman will no doubt wish to have a part in the selection process of a new board chairman who can devote his or her full energy to building this important enterprise," Mr. Webster wrote. "That is my hope and my reason for giving up the position to which I was elected."

Mr. Webster's departure leaves the new Public Company Accounting Oversight Board rudderless less than three weeks after it was set up by the S.E.C. in the aftermath of repeated scandals involving fuzzy and in some causes fraudulent accounting practices that undermined investors' confidence.

Mr. Pitt came under fire after he acknowledged that he had known but failed to disclose to other S.E.C. commissioners that Mr. Webster headed the audit committee of U.S. Technologies Inc., a Washington-based company accused of fraud. Mr. Webster has denied any wrongdoing in connection with the company.

At 78, Mr. Webster brought a reputation for personal and professional integrity to the new accounting post. While no one has suggested that reputation has been besmirched, there have been many suggestions that he was not the best choice for the accounting post.

Mr. Webster was recruited for the accounting-oversight post by the White House. He was approved by the S.E.C., but only after a bitterly divided vote in which two of the five commissioners said he was unqualified.

Earlier, Mr. Pitt backed away from naming John H. Biggs to the accounting post. Mr. Biggs was a chief executive of an investment plan and had been outspoken in calling for stricter accounting rules. Mr. Biggs said some members of the accounting profession found him too tough and complained to Mr. Pitt, who then turned to Mr. Webster as a second, presumably more palatable choice.

LoL Now come on, tellme that with a Name like Chen that this is a surprise? Not to mention she sent a letter to the paper saying she wasn't guilty. I mean, we do have to believe her right?

[Charean]

Can you say,"Total Economic Meltdown?"

Oh yes... here comes another Depression.