WASHINGTON — President Bush is expected today to nominate Rep. Christopher Cox of Newport Beach as chairman of the Securities and Exchange Commission, replacing William H. Donaldson, who resigned Wednesday after aggressively trying to restore investor confidence shaken by corporate scandals.
Bush's choice of Cox to be the nation's top securities cop was confirmed by two senior Republican officials late Wednesday.
The announcement is expected to be made by Bush today at the White House, said the officials, who spoke on condition of anonymity.
Cox, a Republican elected to Congress in 1988, is a graduate of USC and Harvard University's law and business schools who served as a White House lawyer in the Reagan administration. The 52-year-old congressman may be best known on Wall Street for authoring a 1995 law that limited the ability of investors to sue companies over alleged securities fraud.
The resignation of Donaldson, who took over as SEC chief in 2003 at Bush's behest, came as a surprise. He had been expected to serve through this year.
His June 30 departure will give the White House an opportunity to shift the course of the SEC, which has been bitterly split on some high-profile issues of business regulation and investor protection in the wake of corporate fraud and market trading abuses.
Donaldson, a lifelong Republican, adopted an activist approach at the SEC that sparked the ire of the U.S. Chamber of Commerce and other business interests.
In addition to replacing Donaldson, Bush must pick a successor to Democratic Commissioner Harvey J. Goldschmid, who has said he plans to leave this summer. Also, Democrat Roel C. Campos is at the end of his term, although he is expected to be renominated.
Goldschmid on Wednesday echoed the concerns of many investor advocates who fear that a more conservative SEC chief could spur a rollback of some of the reforms the commission has enacted in recent years.
"Everything we've accomplished is in doubt until we see the president's selection of a new chairman," Goldschmid said, before word of Cox's nomination surfaced late in the day.
Donaldson's decision to leave comes as business interests have pushed back with growing confidence against some of the additional regulation imposed by Congress and the SEC since 2001, after massive financial frauds at Enron, WorldCom and other companies, and scandals in the brokerage and mutual fund industries.
