The Securities and Exchange Commission has appointed William Webster, a former judge who has served as director of both the Federal Bureau of Investigation and the Central Intelligence Agency, to oversee a new panel that will audit the financial statements of public companies.
As chairman of the Public Company Accounting and Oversight Board, Webster will oversee the boards efforts to stem corporate fraud. The new panel was mandated by the Sarbanes-Oxley Act, an anti-corporate fraud bill that was signed last summer by President Bush in response to a slew of scandals involving the likes of Enron and WorldCom.
The board is expected to set new accounting standards, requirements for registration, conduct inspections and oversee disciplinary programs, the SEC said in a statement. "The President and Congress have set out an aggressive program for reform of the accounting profession, and the new boards first task is to implement that program," said the SECs chief accountant Robert Herdman. "The act also provides the board with the ability to perceive the need for, and implement, even more reform."
The SEC also appointed four other board members. They are Kayla Gillan, who served six years as chief legal adviser to the California Public Employees Retirement System, Daniel Goelzer, a former SEC general counsel., Willis Gradison, Jr., a former nine-term Congressman from Ohio, and Charles Niemeier, the chief accountant for the commissions division of enforcement and co-chairman of its financial fraud task force.
SEC Chairman Harvey Pitt said that the board members were chosen because "they understand the financial reporting process."
"They are each committed to the meaningful reform," Pitt said. "In addition, they bring to the board a combination of investor advocacy, regulatory and legal experience."
The SEC said that it received roughly 450 nominations and applicants for the board posts. Under the reform measures that were laid out by Congress in the Sarbanes-Oxley Act, the commission, in conjunction with Secretary of the Treasury Paul ONeill, was charged with choosing the board members.