The Telegraph
Since 1st March, 1999
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SEC chairman quits as pressure mounts

Washington, Nov. 6 (Reuters): Securities and Exchange Commission chairman Harvey Pitt resigned under pressure after a series of political missteps that embarrassed the Bush White House just when it needed to shore up investors unnerved by accounting scandals.

In a letter to President George W. Bush yesterday, Pitt said, “The turmoil surrounding my chairmanship had made it difficult to stay in the job. Rather than be a burden to you or the agency, I feel it is in everyone’s best interest if I step aside now, to allow the agency to continue the important efforts we have started.”

The White House quickly accepted his resignation.

As Wall Street analysts downplayed the potential impact on the markets of Pitt’s departure, speculation turned to successors and whether ex-FBI chief William Webster would stay on as head of a new accounting oversight board.

The appointment of Webster last month as chief of the new Public Company Accounting Oversight Board, with Pitt's strong support, precipitated the crisis that led to the SEC chairman's stunning move to step down on Election Day.

Webster reportedly has said he would consider resigning, depending on the outcomes of investigations into how the accounting board’s members were chosen and his role as a director of a company accused of fraud. Probes by the SEC and Congress’ General Accounting Office are under way.

Webster could not be reached late on Tuesday. His colleagues on the accounting board declined to comment on Webster's future. The board was established to crack down on auditors and bolster market confidence after a rash of business scandals that started last fall with energy trader Enron Corp.

For markets, “the real issue is the election,” said Arnie Owen, managing director of equities at Roth Capital Partners in New York. “The Pitt issue has been going on for a couple weeks. ... I don't think it will matter for the markets.”

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