A House Financial Services subcommittee approved legislation Thursday addressing a staffing crisis at the Securities and Exchange Commission.
The Capital Markets Subcommittee approved the measure (H.R. 658) by a voice vote after just minutes of discussion, and encompassed a managers' amendment agreed to by Chairman, Rep. Richard Baker, R-La., and ranking member Paul Kanjorski, D-Pa.
That measure, and the underlying legislation unveiled in February by Baker and Financial Services Chairman Michael Oxley, R-Ohio, is designed to help the SEC quickly hire the professionals it needs to police Wall Street. SEC Chairman William Donaldson recently expressed his support for this new authority in testimony before a House subcommittee.
The legislation would give the SEC the authority to exempt accountants, economists and securities compliance examiners from civil service hiring requirements. The SEC has long had this expedited authority for hiring agency attorneys, and lawmakers have argued that this special authority also is needed to speed the hiring process for accountants, economists and securities compliance examiners.
The SEC recently said it has hired nearly all of the new lawyers the agency was authorized to bring on board in the wake of the recent corporate scandals, but has managed to fill less than 40 percent of the accountant positions. This problem could be exacerbated in the coming year when it is expected that the commission will hire more than 800 new professionals as a result of a funding increase in the SEC's fiscal 2004 budget.
The subcommittee briefly entertained an amendment by Kanjorski, which would have required this new authority to sunset after five years-as opposed to it being made permanent under the legislation. Kanjorski immediately withdrew the amendment, however, and Baker predicted the amendment would be debated "with great enthusiasm" when the legislation goes to the full committee for markup.
Senate Banking Chairman Richard Shelby, R-Ala., and Banking Securities Subcommittee Chairman Michael Enzi, R-Wyo have introduced similar legislation.