Mary Schapiro

Mary L. Schapiro (born June 19, 1955) is the 29th chairman of the U.S. Securities and Exchange Commission (SEC).

She is the immediate past chairman and CEO of the Financial Industry Regulatory Authority (FINRA), the securities industry self-regulatory organization for broker-dealers and exchanges in the United States, and served in various roles as a financial services regulator in the administrations of Bill Clinton, George H. W. Bush, and Ronald Reagan.^[1] She is the first woman to chair the SEC.^[2] In 2009, Forbes ranked her the 56th most powerful woman in the world.^[3]

Early life and education

Schapiro was born in New York City to a Jewish family ^[4]. She graduated from Franklin & Marshall College in 1977. In 1980 she earned a Juris Doctor (J.D.) degree from George Washington University Law School.^[5]. She had an honorary Ph.D. conferred from LeBow College of Business ^[6].

Pre-SEC career

Schapiro was appointed in 1988 by President Ronald Reagan to fill one of two Democratic seats on the SEC. President George H. W. Bush reappointed her to this position in 1989. President Bill Clinton appointed Schapiro as acting chairman of the SEC, and then appointed her chairman of the Commodity Futures Trading Commission in 1994.

In 2009 She promised that as chair of the SEC to be more vigilant. In 1993 Schapiro said regulating derivatives in order to not stifle the "financial innovation" that would result from "a more flexible regulatory paradigm." ^[7] Prior to 2009, Schapiro as a regulator viewed much regulation of financial markets as too burdensome and proposed to work closely with the financial industry to weaken regulations. At her confirmation hearings for SEC chair in 2009, Schapiro reversed herself and advocated for tighter regulation of financial instruments including derivatives, while conceding that the current financial crises was in part due, Schapiro said, to a regulatory system that "has not kept pace with the markets and the needs of investors".^[8] In 1996 Schapiro joined the National Association of Securities Dealers (NASD) (now the Financial Industry Regulatory Authority) as the president of NASD Regulation. She became the vice chairperson of the NASD in 2002, and in 2006 she became NASD's chairperson and CEO. As the CEO of NASD she oversaw its consolidation with NYSE Member Regulation to form the Financial Industry Regulatory Authority.^[9] In 2005 she oversaw a wide-reaching probe into gift-giving and entertaining on Wall Street, uncovering several instances of lavish and excessive activities, that led to many charges.^[10]

She was on the board of directors of Duke Energy and Kraft Foods. In January 2008, President George W. Bush appointed Schapiro to the 19-member council of the President's Advisory Council on Financial Literacy. In 2008, Schapiro was named to Investment Advisor magazine's IA 25, the list of the 25 most influential people in and around the investment advisory business.

In 2008, her last year at FINRA, Schapiro earned a regular compensation package of $3.3 million; on departure from FINRA, she received additional lump sum retirement benefit payments that brought her total package in 2008 to $8,985,334 (about the same as Goldman Sachs CEO Lloyd Blankfein made in that year).^[11]

Career as SEC chair

In 2009, under the direction of Schapiro, the SEC attempted to settle a case with Bank of America regarding the disclosure of bonuses paid to Merrill Lynch executives just before their take over by Bank of America. U.S. District Judge Jed Rakoff threw out the proposed $33 million dollar settlement saying it "does not comport with the most elementary notions of justice and morality".^[12][13]

On June 17, 2009, Bernard Madoff, in an interview by the SEC inspector general David Kotz, said that Mary Schapiro was a "dear friend," although she "probably thinks, 'I wish I never knew this guy.' ".^[14] This was denied by SEC Inspector General David Kotz, who said "there was no evidence that Mr. Madoff had a close friendship with Ms. Schapiro."^[15] Mary Schapiro, while she was at FINRA, appointed Mark Madoff, Bernie Madoff's son, to the National Adjudicators Council (the regulatory body that reviews disciplinary action by FINRA). Shana Madoff, Bernie’s niece, was the compliance officer at Madoff's firm and also a member of the compliance committee of FINRA.^[16]

As Chair, Schapiro has instituted rulemakings aimed at reforming the structure of the markets for securities trading, including particularly dark pool alternative trading systems, internalization, dark order types on exchanges, and ECNs.^[17]

References

External links

• Mary L. Shapiro profile from the Financial Industry Regulatory Authority
• Mary L. Shapiro profile from Forbes
• Biographical information on Mary L. Schapiro AP, December 18, 2008
• SEC Chairperson Mary Schaprio makes first public comments since becoming chairperson of the SEC in address to Practising Law Institute's "SEC Speaks in 2009" Program. February 6, 2009 [4]