Little drama expected for SEC nominees
Aguilar, Gallagher tipped for relatively painless confirmation process
Senate Republicans have thrown up a road block for a director of the consumer protection agency. But the path to confirmation for Securities and Exchange Commission nominees may be smoother.
Earlier this week, President Barack Obama tapped Luis Aguilar, a current SEC commissioner, for another term while selecting Daniel Gallagher, a former co-acting director of the SEC Division of Trading and Markets, to fill the vacancy that will be created when Kathleen Casey leaves in June.
Sen. Richard Shelby, R-Ala., ranking member of the Senate Banking Committee, is leading all 44 Republican senators in refusing to confirm any nominee to be director of the Consumer Financial Protection Bureau until changes are made in how the agency would operate, such as replacing the director position with a five-member board and forcing it to obtain funds through the congressional appropriations process.
So far, there is no indication that Mr. Shelby will make a similar effort to hold up the SEC nominees. He has not issued a statement on Messrs. Aguilar and Gallagher.
“Sen. Shelby will undertake a thorough review of the nominees’ qualifications,” Shelby spokesman Jonathan Graffeo said via email.
The fact that Mr. Aguilar, a Democrat, and Mr. Gallagher, who will be replacing a departing Republican, are being offered as a package may improve their chances of getting through the Senate thicket unscathed.
“The nominations will be paired together and thus make it less likely that Senate confirmation will be delayed for partisan reason,” David Tittsworth, executive director of the Investment Adviser Association, said in an email. “I expect both nominations to be approved, though the timing will depend on the vagaries of the Senate’s schedule.”
The Republican effort to influence how the consumer agency is set up, however, has created uncertainty about the confirmation of financial regulators.
“This is a whole new territory in terms of willingness to subvert the advise-and-consent process,” Barbara Roper, director of investor protection at the Consumer Federation of America, said in an email. “That said, I’m not aware of any passions regarding the SEC that match the desire in some quarters in Congress to thwart the CFPB before it ever gets up and running. Unless the Senate just shuts down the confirmation process completely, I can’t see any reason for concern at this point.”
Both Mr. Tittsworth and Ms. Roper said that Mr. Gallagher, a partner at Wilmer Cutler Pickering Hale and Dorr LLP, and Mr. Aguilar are well qualified for SEC posts.
Ms. Roper particularly praised Mr. Aguilar.
“He has been a real champion for investors during his first term — on fiduciary duty and on a host of other lower profile but equally important investor protection issues,” she said. “He has certainly earned a second term.”
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