Obama's SEC Choice Faces Questions on Lawsuits

Schapiro accused of making misleading statements about regulatory merger
By Jim O'Neill,  Newser User
Posted Jan 12, 2009 8:04 AM CST
President-elect Barack Obama shakes hands with his Securities Exchange Commission chairman- designate, Mary Schapiro, left in Chicago, Thursday, Dec. 18, 2008.    (AP Photo/Lawrence Jackson)
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(Newser) – Mary Schapiro, Barack Obama’s choice to lead the Securities and Exchange Commission, has been accused in two lawsuits of making misleading statements to rush through the 2-year-old merger of two regulatory agencies that resulted in a 57% pay hike for herself, the New York Times reports. Schapiro is to begin confirmation hearings Thursday.

The merged agencies were the regulatory units of the National Association of Securities Dealers and the New York Stock Exchange, to create the Financial Industry Regulatory Authority, tasked with policing Wall Street. Schapiro, head of the NASD at the time, is currently CEO at Finra. The suit claims she misled NASD members about an IRS ruling regarding the proposed merger. Her attorney calls the suit meritless.