Wanted: New SEC Chairman

The White House is turning to the task of finding a replacement for SEC Chairman Harvey Pitt who inspires confidence on Wall Street and Main Street -- but not taking too long to do it.

President Bush wants a Securities and Exchange Commission chairman who will "help crack down on corporate corruption that the president feels so strongly about and who also will continue Harvey Pitt's very successful record of taking action against corporate corruption," White House spokesman Ari Fleischer said Wednesday.

"The timing will be as soon as the transition allows," he said. "I can't guess what ultimately that will be in terms of weeks, months. I don't know that anybody has a firm handle on how long that could be."

The balancing act of moving quickly, but carefully, is illustrated by New York Stock Exchange Richard A. Grasso's assertion that "time clearly is of the essence" and Vanguard Group founder John C. Bogle's admonition that finding someone with stature and independence is as important as speed.

Sen. Trent Lott, R-Miss., who will become majority leader now that the Republicans have recaptured the Senate, said Pitt's successor must be someone "that has the confidence of the American people, the markets and both sides philosophically and politically."

Sen. John McCain of Arizona, the lone Republican to call for Pitt's resignation last summer at the height of the corporate scandals, said his replacement "just has to be a person of impeccable credentials who has not had close ties to any of the industries that the SEC would oversee."

The appointment requires Senate confirmation.

Pitt, meanwhile, attended a routine commission meeting Wednesday but avoided reporters.

Commissioner Harvey Goldschmid, a Democrat who had bitterly opposed Pitt's selection of former FBI and CIA director William Webster to head a new accounting oversight board, said during the meeting that the last few weeks have been "a period of enormous pain" for the SEC.

Roel Campos, the other Democratic commissioner -- who also had objected to Webster's appointment -- on Thursday called Pitt's decision to resign "an act of courage and sacrifice."

"Chairman Pitt took stock of events and placed his country, the American people and this agency above his own interests. His resignation is a model of dignity and grace. I salute him," Campos said in a statement.

Another commissioner, Republican Cynthia Glassman, said in a statement she was "sad and disappointed" by Pitt's resignation.

Bush could name Glassman or fellow GOP commissioner Paul Atkins -- who have both worked in accounting -- as interim SEC chairman until the president nominates a permanent successor.

Former SEC Chairman Richard Breeden was said to have been informally approached to replace Pitt, but declined. And former New York Mayor Rudolph Giuliani has been mentioned for the post, but said he wasn't interested.

Webster's own future as head of the new oversight board is unclear. He said this week he would step aside if he decided he couldn't be effective.

Fleischer said Bush had not requested Pitt's resignation. But the White House made no secret that Bush was angered by Pitt's failure to warn the administration about Webster's role with the auditing committee of a company under SEC scrutiny.

Pitt, an attorney who first worked at the SEC in the late 1960s, has been criticized for meeting with the heads of companies under SEC investigation and for his close ties to the accounting industry when the commission is investigating major accounting fraud at big corporations.