Chairman Sarbanes, Senator Gramm, Distinguished Members of this Committee:
It is with great respect, and humility, that I appear before you today, to seek your confirmation of President Bush’s nomination of me to serve as a member of the Securities and Exchange Commission. I am deeply grateful to President Bush for the honor he has accorded me by this nomination, as well as by his stated intention to appoint me the next Chair of the Commission, if I am fortunate enough to be confirmed. And, I thank you, Chairman Sarbanes, Senator Gramm and the Members of the Committee and Staff, for your support and expeditious scheduling of this confirmation hearing. I am particularly grateful to my fellow Brooklynite, Senator Schumer, for his kind introduction of me to the Committee.
With your permission, I would like briefly to introduce some of the members of my family here today to witness this important hearing. First, I would like to introduce my wife and best friend, Saree Ruffin Pitt. Next, I would like to introduce my father, Morris Pitt, of New York, who is 87, and without whom I would not be here today. I would also like to introduce my wife’s parents, Dalton and Sarah Ruffin, of North Carolina. Finally, I would like to introduce to you my four children, Emily, Jonathan, Robert and Sally.
I come before this Committee with deep respect for the critical role assigned to Congress in general, and to this Committee in particular, with respect to the important multiple missions of the SEC. If I am confirmed, I pledge to work with you, and the Administration, to ensure that the Commission is a partner, an independent partner to be sure, but not an adversary, in our mutual desire to maintain our capital markets as the fairest for all investors, large and small, and the most efficient in helping our corporations raise needed capital to succeed in highly-competitive global markets. This is a critical time in the development and strategic future direction of our capital markets. It is a time for bold and creative thinking, to formulate an agenda that will ensure that the SEC’s next decade can be as universally respected and admired as its past, nearly-seven, decades.
Seated before you is a first generation American, who has benefited from the manifold opportunities this Country offers to people of limited means to achieve a piece of the American Dream. The SEC has a key role to play in overseeing markets that enable millions of Americans to fuel that dream. I have devoted my entire professional life to that role. Over the past 33 years, working first at the SEC, and then in the private sector, as a securities lawyer, I have been blessed with wonderful colleagues, and have been fortunate to enjoy a broad and diverse exposure to the many aspects of securities regulation and enforcement. Nearly a quarter century ago, I was privileged to serve as SEC General Counsel, an experience that shaped my life as a lawyer and counselor. As a result of my experiences within and outside the Commission, I have enormous respect for the agency, its mandate, and the dedicated people who strive to give Congress’s legislative words true meaning, day in and day out. Having an opportunity to serve the investing public, and the needs of our capital markets, would make my fondest dreams a reality.
There are several goals I would pursue, if I am confirmed and become the next SEC Chair. First, I will ensure vigilant enforcement of sound rules that protect all investors against fraudulent, deceptive and manipulative misconduct, and that make our capital markets the world’s most honest, efficient, and envied. While I am proud of my past legal practice on behalf of private clients, I want to assure you that my commitment to the public interest and public investors, both small and large, is genuine, strong and all encompassing.
Second, I will focus on the agency’s mission to nurture a climate that is conducive to, and encourages, the creation of capital. Much has changed since the SEC’s birth ─ new competition at home and abroad, new technology, instantaneous communications, exponential increases in international trade, the creation of more complex financial products, and greater involvement in our markets by both American citizens and overseas investors. Capital is the life blood of innovation. Emerging businesses, and established multinational conglomerates, create jobs, research and development breakthroughs, and higher standards of living. I believe the Commission has a mandate to ensure efficient, cost-effective and seamless capital-raising.
Third, to protect American capital markets and their participants, we must ensure that our marketplaces remain vigorous and efficient. I would like the SEC to lead a review of the requirements it administers, and the regulations it imposes, to be certain they are sound, reasonable, cost-effective, and promote competition. Our securities laws are, in the main, nearly seventy-years old, and reflect a time, and a state of technology, light years away from what we now confront daily. Commission rules are rapidly becoming the securities equivalent of the Internal Revenue Code, making it difficult for those obliged to comply with the rules to understand their obligations, and making it impossible for those who benefit from those rules to understand the rights they have and how to enforce them. I believe the Commission, working with this Committee and its House of Representatives counterpart, is obligated to ensure that statutory and regulatory requirements do not needlessly increase costs or drive transactions offshore, where investors often lack protection of the laws the Commission enforces.
Finally, but not least, I believe government is a service industry. To make government meaningful, efficient and competent, agencies like the SEC must reflect a commitment to service. If confirmed, I will devote my total and untiring efforts to enhancing the Commission’s responsiveness to all its constituencies, with respect, professionalism, clarity and expedition. That is the superb legacy of the SEC to which I am fully committed. If confirmed, I eagerly look forward to working with you during the coming years, and I feel confident about the ability of all of us working together, with the best interests of investors, issuers and the markets in mind, to meet these challenges.
Thank you, Mr. Chairman, Senator Gramm, and Members of the Committee, for this opportunity. I would be pleased to try to answer any questions you may have.
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