SEC Chairman Jay Clayton testified Thursday in a hearing called "Capital Markets and Emergency Lending in the COVID-19 Era." (Photo: Brendan Smialowski/AFP/Bloomberg
In testimony before a House panel, Securities and Exchange Commission Chairman Jay Clayton stopped short of stating that he would bow out of considering President Donald Trump's nomination of him to take over as the U.S. attorney for the Southern District of New York, replacing Geoffrey Berman, who was fired, and that he was "committed" to leading the commission.
Clayton opened his testimony before the House Financial Services Subcommittee on Investor Protection, Entrepreneurship and Capital Markets by stating that he first wanted to address his "potential nomination" to the court.
"I have a long-held, deep respect for the work of the Southern District," Clayton said, "which is recognized throughout our nation and internationally for enforcing the law, pursuing justice, without fear or favor. My deep personal respect is largely the result of working with the Southern District and its distinguished alumni, including senior personnel at the SEC. I recognize that the nomination process is multifaceted, and uncertain. It's clear the process does not require my current attention. In short, I'm fully committed to and focused on my role at the SEC."
House Financial Services Committee Chairwoman Maxine Waters, D-Calif., questioned Clayton on Trump's intention to nominate him to the court.
The firing of Berman, Waters said, "appear to be a continuation of Trump's efforts to squash any attempts to hold him and his enablers accountable."
Waters noted the Southern District of New York "has been instrumental in conducting independent investigations into President Trump's associates and the Trump organization and is currently investigating Deutsche Bank, an institution with long and substantial financial ties to President Trump."
Waters stated that she's "deeply concerned that while your nomination to this important post is pending, President Trump and Attorney General [William] Barr may try to interfere with your ability to independently and effectively oversee the Securities and Exchange Commission and serve as Wall Street's cop on the beat during a global health pandemic that has caused one of the worst financial crises of our lifetime."
Waters then asked Clayton if he planned to continue serving as chair of the SEC while he awaited his confirmation to the court.
Clayton responded: "As I mentioned in my opening statement, I don't think that matter requires my attention at this time. I expect to continue to devote my full attention to the commission."
Rep. Carolyn Maloney, D-N.Y., probed Clayton on when he first discussed the Southern District position with the president or the administration, including with Barr.
The issue, he said, "was first raised with the president and attorney general last weekend as something that I wanted to do; they first became aware of it last weekend."
Rep. Madeline Dean, D-Pa., later inquired as to exactly when Clayton's conversation took place with Trump administration.
Clayton replied: "The weekend of the 12th was the initial conversation."
Said Dean: "That would have been the weekend before the Friday night firing of Berman."
Responded Clayton: "Yes, the weekend of the 12th. … The first time it was raised was the weekend of the 12th….Let me be clear on this issue, this was entirely my idea. This is something that I've been thinking about for several months as a possible continuation of public service."
Maloney also asked if Clayton would recuse himself from all of the Southern District's "current investigations of President Trump and his associates."
Replied Clayton: "Here's what I'm going to say: That's a process that's way down the road. In my current position and in any position I take, I commit to doing it independently, without fear or favor, in the pursuit of justice."
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Melanie Waddell
Melanie is senior editor and Washington bureau chief of ThinkAdvisor. Her ThinkAdvisor coverage zeros in on how politics, policy, legislation and regulations affect the investment advisory space. Melanie’s coverage has been cited in various lawmakers’ reports, letters and bills, and in the Labor Department’s fiduciary rule in 2024. In 2019, Melanie received an Honorable Mention, Range of Work by a Single Author award from @Folio. Melanie joined Investment Advisor magazine as New York bureau chief in 2000. She has been a columnist since 2002. She started her career in Washington in 1994, covering financial issues at American Banker. Since 1997, Melanie has been covering investment-related issues, holding senior editorial positions at American Banker publications in both Washington and New York. Briefly, she was content chief for Internet Capital Group’s EFinancialWorld in New York and wrote freelance articles for Institutional Investor. Melanie holds a bachelor’s degree in English from Towson University. She interned at The Baltimore Sun and its suburban edition.
