Even though President Barack Obama has nominated Mary Jo White to be chairman of the Securities and Exchange Commission, that doesn't mean that the tenure of current chairman Elisse Walter will end any time soon.
At a
White House ceremony on Jan. 24, Mr. Obama announced both Ms. White's appointment and the nomination of Richard Cordray to be the permanent head of the Consumer Financial Protection Bureau. Of the two, Mr. Cordray faces the steeper climb to Senate confirmation.
Republicans want Congress to have more control over the CFPB budget and agenda. They may use Mr. Cordray's confirmation process as a way to express their displeasure with an agency that they see as the embodiment of Dodd-Frank overreach.
Ms. White, the former U.S. Attorney for the Southern District of New York, hasn't drawn any immediate political push back. But even a smooth confirmation process might not conclude until March, giving
Ms. Walter plenty of time to wrestle with major issues like money-market reform and a rule that would allow public advertising of private stock offerings.
First, she'll have to appear before the Senate Banking Committee for a hearing. It will give senators – and the public – a chance to hear Ms. White speak for the first time on regulatory issues, an area in which she has no paper trail, after spending her career as a prosecutor and defense attorney.
After that hearing, her nomination will have to secure Senate floor time – one of the most precious commodities in Washington.
Beyond the logistical challenges of the Senate calendar, Ms. White's confirmation could be delayed so that the Obama administration can pair her with a Republican appointment to the SEC. This kind of dual nomination was most recently seen in 2011, when the Senate approved Democrat Luis Aguilar and Republican Daniel Gallagher for commission slots.
This time around, the Obama administration could pair Ms. White with a Republican to replace Troy Paredes, whose term expires in June.
“You could possibly see another nomination coming out of the administration, which would help assuage any [Republican] concerns about Ms. White,” said Duane Thompson, senior policy analyst for Fi360, a fiduciary duty training consultant.
Ms. White might also be included in a package of three or more nominees for other agencies, according to Barbara Roper, director of investor protection at the Consumer Federation of America.
When she finally is put before the Senate for a vote, Ms. White might have wide appeal. Democrats may like the idea that she can turn her prosecutorial zeal on Wall Street, while Republicans may be reassured by the fact that she's defended Wall Street firms during her decade as head of the litigation department at Debevoise & Plimpton LLP.
“Someone who's reputed to be smart, energetic and a good administrator is a good deal,” Ms. Roper said.
The Obama administration may be disarming the Senate by making an innovative choice for the SEC. Ms. White would be the first litigator to take the reins of the SEC.
“It's kind of a different choice…[rather than someone] coming from the regulatory or policymaking side,” said Terry Reilly, who is of counsel at Montgomery McCracken Walker & Rhoads.
Although this SEC candidate is unusual, the confirmation process will likely follow its typical circuitous path.
