Elisse Walter is new SEC chair

WASHINGTON - President Obama has chosen Elisse Walter, one of five members of the Securities and Exchange Commission, to become chairman of the agency. Chairman Mary Schapiro will leave next month after a tumultuous tenure in which she helped lead the government's regulatory response to the 2008 financial crisis.

Walter, 62, will take over at a critical time for the SEC, which is finalizing new rules in response to the 2008 crisis. She can serve through 2013 without Senate approval because she has already been confirmed to the commission. A Democrat, she was appointed to the SEC in 2008 by President George W. Bush.

Earlier, Walter was a senior official at the Financial Industry Regulatory Authority, the securities industry's self-policing organization. She served at FINRA under Schapiro, who led the organization before becoming SEC chairman in January 2009.

Schapiro will leave the SEC on Dec. 14. She was appointed by Obama in the midst of the worst financial crisis since the Great Depression. She also took over after the agency failed to detect the Bernard Madoff Ponzi scheme.

Schapiro, 57, is credited with helping reshape the SEC after it was accused of failing to detect reckless investments by many of Wall Street's largest financial institutions before the crisis. And she led an agency that brought civil charges against the nation's largest banks.

Critics argued that Schapiro failed to act aggressively to charge leading individuals at those banks who might have contributed to the crisis. Consumer advocates questioned Schapiro's appointment because she had led FINRA.

Under Schapiro, the SEC reached its largest settlement ever with a financial institution. Goldman Sachs & Co. agreed in July 2010 to pay $550 million to settle civil fraud charges that it misled investors about mortgage securities before the housing market collapsed in 2007.